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Marchionne Promises More Money in Employee Letter

FCA Chief lays out plans for reorg of plants.

by on Sep.18, 2015

FCA Chief Sergio Marchionne sent a letter to the company's UAW employees telling them the new deal puts more money in their pockets.

In a letter to the employees of FCA U.S. Chief Executive Sergio Marchionne said the new tentative labor agreement with the United Auto Workers puts the company on a more cooperative and ultimately competitive footing.

“I believe this agreement, which still requires UAW member ratification, is a transformational deal because it guarantees that our workers will share equitably in the success we are able to generate working together while ensuring that our company will be able to remain competitive,” Marchionne said in his letter.

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“This new contract represents a major step forward in enabling greater and more direct involvement of our workers in the achievement of the strategic objectives of FCA and recognizes the central role that you all play in building our common future. Without you and your commitment, our plan is simply unachievable,” he added. (more…)

UAW Declines to Pick Target for Talks

UAW's Williams says negotiations with makers on track.

by on Sep.08, 2015

UAW President Dennis Williams said talks with the automakers were "about where we should be" during Detroit's Labor Day parade.

With contract talks entering their final week, the United Auto Workers is holding off naming a target company for finishing off the talks by next week’s deadline, marking a significant change from past contract discussions.The union’s labor contracts with Ford Motor Co., General Motors Co. and FCA U.S. all expire at 11:59 p.m. Sept 14. Neither the union or the automakers have said much about the negotiations through the summer.

The union usually picks one company as the focus of the negotiations as the deadline approaches. The decision to name a target not only expedites the negotiations, but also allows both sides to clarify key objectives and issues.

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During the Labor Day parade, workers handed out leaflets calling attention to the need to eliminate the two-tier wage system and both workers on the first and second tier a pay increase. Senior workers haven’t had a pay increase in 10 years, the leaflet noted, and have lost purchasing power in the last two contracts. (more…)

Move to Mexico Makes Ford Potential UAW Target

Ford may use promise of new product to ease UAW concerns.

by on Jul.23, 2015

Past UAW President Bob King shakes hands with Ford Chairman Bill Ford to kick off labor talks. This time around, the process may be a little bumpy.

Ford Motor Co. and the United Auto Workers are scheduled to open negotiations in Detroit today with a special ceremony at the Detroit’s Cass Technical High School.

Over the years, relations between Ford and the UAW have been relatively peaceful, compared to those at General Motors and the old Chrysler Group, which has morphed into FCA US. There hasn’t been a strike of any kind at Ford since 1976 and today Ford actually employs slightly more union members than GM. Over the years, Ford and the UAW has simplified and expanded the profit sharing plan for union.

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In addition, Ford managed to get an edge over its domestic rivals back in 2006 when it negotiated a sweeping reduction in work rules at plants in the U.S. GM and Chrysler wound up in bankruptcy before they got the same level of assistance from the union, which was concerned that both companies could disappear without the assistance of additional concessions. (more…)

UAW Breaks With Labor Allies

Union endorses S. Korea free trade pact.

by on Oct.14, 2011

UAW President Bob King breaks with labor colleagues over new U.S. free trade pact.

On the eve of President Barack Obama’s visit to a General Motors Assembly plant outside Detroit to sign a new free trade pact with South Korea, the United Auto Workers broke with other unions by endorsing the new agreement.

“The UAW is pleased with congressional approval of the U.S.-South Korea Free Trade Agreement,” the UAW said in a statement issued on the eve of the President’s visit to the Detroit area. The Orion plant was apparently selected for the signing ceremony because it is building a car that had been imported into the U.S. from South Korea up until this summer.

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“The revised agreement,” said UAW President Bob King, “creates significantly greater market access for American auto exports and contains strong, auto-specific safeguards to protect our domestic markets from potentially harmful surges of Korean automotive imports.”

The UAW has been critical of U.S. trade policy and practices for more than 30 years but King said he is satisfied with provisions of the new deal with Korea.


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.


Good News Could be Bad News for Ford

Workers reject concessions; exec pay, profits spur backlash.

by on Nov.02, 2009

Ford CEO Alan Mulally will likely have some good news to announce in regards to Q3 earnings, today, but the news will be undercut by word the UAW has rejected a package of proposed concessions.

CEO Alan Mulally will likely good news on Q3 earnings, today, but it will be undercut by the UAW's rejection of proposed concessions.

With one of the worst recessions slowly dragging to a close and auto sales just beginning to show some vague signs of life after the more severe downturn in decades, one might think the likelihood of a good third-quarter earnings report by Ford Motor Co. would be something to cheer about.

Not necessarily.  Ironically, it could make it even harder for Ford to compete in the long-run.

Though the automaker has so far posted profits of $834 million for the first six months of 2009 – a sharp turnaround from the $29.8 billion it lost between 2006 and 2008 – this year’s black ink was largely due to debt reduction and one-time charges and, and not a true profit from operations.  But the third quarter, according to analysts’ estimates, is expected to bring black ink from what Ford is supposed to do best: build and sell automobiles.

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The forecasts variety widely.  One survey, by Thompson Reuters, predicts a relatively modest loss of 13 cents, barely 10% of the $1.31 loss during the third quarter last year.  But J.P. Morgan analyst Himanshu Patel is more bullish, forecasting a 16 cent profit per share.