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$5 a Day – How Henry Ford Kick-Started the American Middle Class

Higher wages helped create a market for his Model T.

by on Jan.06, 2014

Ford's big wage hike in January 1914 was a source of headlines across the country.

Looking back in history there are plenty of events that helped shape our collective modern life, such as the inventions of the light bulb and telephone. But perhaps no single moment was more pivotal than a day exactly 100 year ago when Henry Ford announced he would double the pay for 25,000 of his employees.

Not only did Ford boost wages to $5 a day but he cut the time his employees spent toiling on the grueling assembly line from nine to eight hours.

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He was hailed by workers – and inundated by 10,000 job applicants who raced to his Model T plant in the Detroit suburb of Highland Park. The industrialist also was derided by many of his manufacturing colleagues, some declaring him a socialist, others warning that the added costs could bankrupt the Ford Motor Co.


Ford Planning Big Bump in US Production Under New Contract

Maker will shift work back to U.S. from Mexico, Europe.

by on Oct.04, 2011

Ford will build both plug-in and conventional hybrid versions of the new C-Max in the U.S. under the new UAW contract.

Ford Motor Co.’s new contract with the United Auto Workers Union also contained a revealing amount of information about the company’s future production plans — which now appear to include a large bump in U.S. operations.

Along with $6,000 signing bonuses, enhanced profit sharing and $7,000 in inflation protection, the tentative 4-year agreement will add at least 5,750 new UAW jobs, Ford officials announced, with the company acknowledging $6.2 billion in additional investments in products and plants – bringing to $16 billion the commitment it has now made.

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Among the most critical developments, the union appears to have saved the AutoAlliance plant in the Detroit suburb of Flat Rock, which had been operated as a Ford/Mazda joint venture.  The Japanese maker plans to pull out production of its Mazda6 and though it has suggested it might switch to a replacement, that isn’t considered likely.  So, with only the Mustang to build the plant had seemed doomed to closure.


Are Ford and UAW Ready to Announce a Deal?

Senior union leaders summoned to Detroit Tuesday morning.

by on Oct.03, 2011

UAW Pres. Bob King shakes hands with Ford Chairman Bill Ford as negotiations open in July.

Are Ford and the United Auto Workers Union ready to announce a deal on a new 4-year contract?

There are certainly signs that an agreement is at hand, the UAW calling senior local leaders to Detroit for a Tuesday morning meeting that sources indicate will be used to discuss a tentative agreement.  The likely settlement is expected to at least match the gains both General Motors and the union each claimed in the settlement they reached last month – though Ford is also expected to provide a slightly larger bonus to its hourly employees.

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Negotiations, meanwhile, continue at Chrysler, though there are indications the two sides have hit some significant stumbling blocks over issues that include a desired up-front “signing bonus,” as well as an increase in wages for second-tier hourly employees currently earning just half of what veteran Chrysler employees get.


Ford Offers Buyout to All 41,000 U.S. Workers

Automaker aims to cut costs after union rejects concessions.

by on Dec.22, 2009

Ford is offering buyouts of up to $70,000 to its 41,000 U.S. assembly line workers.

It could get difficult if all 41,000 of Ford’s U.S. factory workers were to accept the automaker’s latest buyout offer.  In fact, the company is hoping for a small but unspecified number of employees to accept the offer of up to $70,000 in cash as it looks to trim payroll costs.

A spokesman for Ford says the company is still struggling with “a surplus in employees,” as it struggles to right-size its production base.  Reduced capacity means fewer employees will be needed long-term.

Like its cross-town rivals, Ford has been using buyouts for a number of years to trim back its base of United Auto Workers Union-represented employees.  Last July, about 1,000 workers took the maker up on its most recent offer.

The new deal would put as much as $70,000 in cash in the hands of relatively new employees, while workers who are approaching retirement anyway could leave early and pocket an extra $60,000.


Ford is considered the strongest of Detroit’s Big Three automakers, right now, though that puts it in an awkward position.  It was able to skip the federal bailouts rivals General Motors and Chrysler needed to stay in business.  But its relatively strong cash position has made it difficult to sell workers on proposed concessions that would allow Ford to match the reduced labor costs at GM and Chrysler, post-bankruptcy.


Ford Wants Changes in UAW contract

Automaker wants big changes, including no-strike clause.

by on Jul.21, 2009

Ford quality is up, says CEO Alan Mulally; now it wants more cost-cutting by the UAW.

Ford quality is up, says CEO Alan Mulally; now it wants more cost-cutting by the UAW.

Ford Motor Co. has approached the United Auto Workers Union about changes in the contract that it negotiated in February before General Motors and Chrysler Group LLC used the threat of bankruptcy to obtain even greater concessions from the union.

Joe Hinrichs, Ford group vice president for global manufacturing, said that the company has already discussed possible changes with the UAW and is now ready to negotiate a revised deal.

“On economics we have the same package,” said Hinrichs, referring to the deals granted Chrysler and GM. However, Ford is looking for additional changes in contract language that would consolidate the number of skilled trades classification. That can translate into dramatic reductions in labor costs and marked improvement in productivity – as well as impacting quality.

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Ford had won a reduction in earlier rounds of negotiations in 2006 and 2007, but the new GM and Chrysler contracts go even further, accepting just two classifications.  Ford would like to obtain the same language.