Ford to cut wages in UAW deal
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Ford to cut wages in UAW deal
DETROIT (Reuters) – Ford Motor Co said on Wednesday that it expects operating savings of $500 million per year from an agreement with the United Auto Workers that will push hourly wage rates into the "ballpark" of foreign-based rivals.
Ford said the agreement would trim its average wages for the 42,000 workers covered under the contract, including the value of benefits, to about $55 per hour this year, while the U.S. operations of foreign-based automakers -- or what auto executives call "transplants" -- pay workers on average $48 to $49 per hour.
The agreement with the UAW, which workers ratified earlier in March, allows Ford to suspend some performance and bonus payments, reduce overtime costs and cut a paid holiday, as well as restructure funding of a union retiree healthcare trust.
Joe Hinrichs, Ford's global head of manufacturing, said the savings from the operating agreement and restructuring of the funding of the trust, the Voluntary Employee Beneficiary Association, are "critical to our future competitiveness."
"This gets us to within the ballpark of where the transplants are," Hinrichs said in a conference call with analysts and reporters.
"Over the next couple of years with the buyouts and with the ability to leverage some of the other tools that are now in this agreement, we think we can get there within the next couple of years on parity with the transplants," he said.
The annual savings could exceed $500 million if industry conditions allowed Ford to exercise all of the changes in the agreement, Hinrichs said. About half of the annual savings would come from the elimination of performance bonuses and the Christmas bonus and the suspension of cost of living increases.
Ford restructured payments into the VEBA, including the option to contribute about half in company stock, to conserve cash. The plan to make payments in stock requires shareholder approval at the Ford annual meeting this year.
Ford, which posted a record $14.7 billion net loss for 2008, has said it believes it has adequate liquidity to operate through the economic downturn without seeking emergency U.S. government loans.
The agreement with the UAW effectively puts Ford's U.S. hourly wage rates in line with the cuts cross-town rivals General Motors Corp and Chrysler LLC have been negotiating with the union under their government bailouts.
Chrysler, about 80 percent controlled by Cerberus Capital Management LP, and GM have received $17.4 billion of emergency government loans and have requested billions more in emergency loans to complete restructurings.
"It appears that the agreement essentially meets the terms set forth by the U.S. Treasury loan (to GM)," KeyBanc Capital Markets analyst Brett Hoselton said in a note to clients.
"If correct, we believe this is a significant milestone and investors should now turn their attention to negotiations with the bondholders," Hoselton said.
Ford has announced salaried job cuts and executive pay reductions and last week launched an effort to reduce $25.8 billion of automotive debt by up to 40 percent through conversion of debt to equity and tender offers.
Ford also has agreed to offer buyouts to UAW-represented workers from April 1 through May 22. Ford has offered buyouts previously to hourly workers and the offers will be lower than those in the past due to the current economic conditions.
Ford plans to consolidate assembly work between adjacent Michigan Truck and Wayne Assembly plants near Detroit. The automaker is converting its Michigan Truck plant to build the European-designed 2010 Ford Focus small car.
The Wayne facility will continue to perform stamping and some body work and the consolidation is not expected to result in job cuts from the Wayne facility.
In late morning New York Stock Exchange trade, Ford shares were up 14 cents or 7.6 percent to $1.99.
(Reporting by David Bailey; Editing by Lisa Von Ahn and Gerald E. McCormick)
#2
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OK, maybe I'm missing something, but $55.00 x 40 hours x 52 weeks = $114,400!!!
Tell me it's the "new math" or something, but $114k a year to build cars?!?! ****, sign me up!!
On a side note, I am glad that Ford is working to get their costs in line, but geez, that's still crazy.
Any lawyers on the board? Tell me why we can't "fire" the union and pay them a respectable rate? Does the union have a legal right to exist and demand a wage? What would happen in GM fired all union workers and re-hired non-union workers at have the pay? Lawsuit city? What's the basis?
Tell me it's the "new math" or something, but $114k a year to build cars?!?! ****, sign me up!!
On a side note, I am glad that Ford is working to get their costs in line, but geez, that's still crazy.
Any lawyers on the board? Tell me why we can't "fire" the union and pay them a respectable rate? Does the union have a legal right to exist and demand a wage? What would happen in GM fired all union workers and re-hired non-union workers at have the pay? Lawsuit city? What's the basis?
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OK, maybe I'm missing something, but $55.00 x 40 hours x 52 weeks = $114,400!!!
Tell me it's the "new math" or something, but $114k a year to build cars?!?! ****, sign me up!!
On a side note, I am glad that Ford is working to get their costs in line, but geez, that's still crazy.
Any lawyers on the board? Tell me why we can't "fire" the union and pay them a respectable rate? Does the union have a legal right to exist and demand a wage? What would happen in GM fired all union workers and re-hired non-union workers at have the pay? Lawsuit city? What's the basis?
Tell me it's the "new math" or something, but $114k a year to build cars?!?! ****, sign me up!!
On a side note, I am glad that Ford is working to get their costs in line, but geez, that's still crazy.
Any lawyers on the board? Tell me why we can't "fire" the union and pay them a respectable rate? Does the union have a legal right to exist and demand a wage? What would happen in GM fired all union workers and re-hired non-union workers at have the pay? Lawsuit city? What's the basis?
I've always wondered that too, what if they fired the union? but they have it contracts and I'm guessing that in those contracts it states something to the effect of "if you terminate this contract the union will f*ck you and your family in more ways than one"
#5
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Dept of Labor backs the "right" of collective bargaining I believe (aka unions). GM,Ford, etc... all have legal binding contracts with the UAW ... these contracts date back years ago, and now are to the point where it's just bleeding the companies dry
Look at the new Camaro ... part of the reason for Hiatus of even the name was because of a contract w/the CAW that as long as the St. Theresé facility existed, the Camaro could only be made there ... so what'd GM do? knock the facility down lol
Hence the reasoning chapter 11 would be better... it would effectively null and void these union contracts ... and then maybe GM (or Ford, or Chrystler) wouldn't make the same mistake again
Look at the new Camaro ... part of the reason for Hiatus of even the name was because of a contract w/the CAW that as long as the St. Theresé facility existed, the Camaro could only be made there ... so what'd GM do? knock the facility down lol
Hence the reasoning chapter 11 would be better... it would effectively null and void these union contracts ... and then maybe GM (or Ford, or Chrystler) wouldn't make the same mistake again
#6
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OK, maybe I'm missing something, but $55.00 x 40 hours x 52 weeks = $114,400!!!
Tell me it's the "new math" or something, but $114k a year to build cars?!?! ****, sign me up!!
On a side note, I am glad that Ford is working to get their costs in line, but geez, that's still crazy.
Any lawyers on the board? Tell me why we can't "fire" the union and pay them a respectable rate? Does the union have a legal right to exist and demand a wage? What would happen in GM fired all union workers and re-hired non-union workers at have the pay? Lawsuit city? What's the basis?
Tell me it's the "new math" or something, but $114k a year to build cars?!?! ****, sign me up!!
On a side note, I am glad that Ford is working to get their costs in line, but geez, that's still crazy.
Any lawyers on the board? Tell me why we can't "fire" the union and pay them a respectable rate? Does the union have a legal right to exist and demand a wage? What would happen in GM fired all union workers and re-hired non-union workers at have the pay? Lawsuit city? What's the basis?
Not a lawyer... but my guess would be contracts between GM and the UAW.
UAW could sue for breach of contract.
[edit] Looks like horist already answered that... my bag.... didn't read the post.
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Good for Ford.
The workers are not making $55/hr, more like $25/hr plus Benefits and Union dues.
Unions have become a business all to their self.
There is a lot of paper pushers, and middle management and top brass, and lawyers that collect part of those hourly figures quoted, (Union dues)
And to answer your questions about firing the wokers.
If GM and the others tried to do something like that the Unions would strike.
No cars would get produced, it happened in 1998.
Thats why many manufacturers moved their factories out of the Country to Mexico, or Canada.
In the 60's and 70's when the Unions were very strong, the Big 3 really had no choice but to give in to the Unions demands. If they didn't the Unions would shut them down in a heartbeat.
Or in Great Britians case the workers would sabotage the product.
The 70's were the height of the strong Unions and a time when many of them got very greedy.
Unions were, and can be a very good thing and we needed them.
But just like the bankers of today got greedy and we're suffering, they to got greedy. As a result of pushing too hard the Unions have found themselves in a vulnerable position.
The workers are not making $55/hr, more like $25/hr plus Benefits and Union dues.
Unions have become a business all to their self.
There is a lot of paper pushers, and middle management and top brass, and lawyers that collect part of those hourly figures quoted, (Union dues)
And to answer your questions about firing the wokers.
If GM and the others tried to do something like that the Unions would strike.
No cars would get produced, it happened in 1998.
Thats why many manufacturers moved their factories out of the Country to Mexico, or Canada.
In the 60's and 70's when the Unions were very strong, the Big 3 really had no choice but to give in to the Unions demands. If they didn't the Unions would shut them down in a heartbeat.
Or in Great Britians case the workers would sabotage the product.
The 70's were the height of the strong Unions and a time when many of them got very greedy.
Unions were, and can be a very good thing and we needed them.
But just like the bankers of today got greedy and we're suffering, they to got greedy. As a result of pushing too hard the Unions have found themselves in a vulnerable position.
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#8
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There you go Ford! Way to F&*K the people who actualy deserve what little money they get. The ones who do all the work get the cuts. What's funny is it cost Ford 11k to build an Escape and they sell them for 30k fully loaded, but for some reason it's the union workers who are making them go broke??? BULLSHIT That 11k also includes operator pay.(The people building the damn cars.)
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There you go Ford! Way to F&*K the people who actualy deserve what little money they get. The ones who do all the work get the cuts. What's funny is it cost Ford 11k to build an Escape and they sell them for 30k fully loaded, but for some reason it's the union workers who are making them go broke??? BULLSHIT That 11k also includes operator pay.(The people building the damn cars.)
Yeah ford, the company should quit f*cking its workers and keep paying them out the *** so the whole company goes under and everyone is out of a job
you sir, are a moron.... $28+ an hour for unskilled manual labor is ridiculous, show me where you get this cost of $11k to build a loaded escape and Ford makes a claimed profit of $19k per escape??
#11
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Fact is, taking a pay cut is a heck of a lot better than shutting down an entire plant because it's cheaper to shut it down then to pay guys to sit at home and not make cars months at a time every year.
Unions had their place when we didn't have labor laws or OSHA. Back when it was common practice for guys to get injured, maimed, or even killed on the job and the corporations did nothing to change conditions. It was ok back then to force workers to work in horrible conditions and extrem hours. But those times are long gone. Now guys in unions have work quotas and are pushed to work bare minimums. God forbid you do something that is a 'union job' because they'll file a greivance against you for stealing a job from them.
Sorry, unions need to go the same direction as the dinosaurs and become extinct.
Unions had their place when we didn't have labor laws or OSHA. Back when it was common practice for guys to get injured, maimed, or even killed on the job and the corporations did nothing to change conditions. It was ok back then to force workers to work in horrible conditions and extrem hours. But those times are long gone. Now guys in unions have work quotas and are pushed to work bare minimums. God forbid you do something that is a 'union job' because they'll file a greivance against you for stealing a job from them.
Sorry, unions need to go the same direction as the dinosaurs and become extinct.
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Yeah ford, the company should quit f*cking its workers and keep paying them out the *** so the whole company goes under and everyone is out of a job
you sir, are a moron.... $28+ an hour for unskilled manual labor is ridiculous, show me where you get this cost of $11k to build a loaded escape and Ford makes a claimed profit of $19k per escape??
you sir, are a moron.... $28+ an hour for unskilled manual labor is ridiculous, show me where you get this cost of $11k to build a loaded escape and Ford makes a claimed profit of $19k per escape??
What's funny is these people who talk about **** they have no clue about. I'm glad god put dumb people on earth(ChaseSS) I love laughing at them!!!
You know that Henry Ford wanted his employees to be able to afford the vehicles they produce, Good luck affording anything when they take away half your pay!!!
#13
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It's funny how they cut the guy on the bottom but continue to put money into the fun stuff. Oh, we'll pay guys to do **** that has nothing to do with building an automobile, but the men and women who get dirty every day or nite can eat ****....
ChaseSS is also from St. Louis where they shut a plant down. Gee I wonder why, with people like that in the area I have a hard time seeing any company being successfull.
#14
There you go Ford! Way to F&*K the people who actualy deserve what little money they get. The ones who do all the work get the cuts. What's funny is it cost Ford 11k to build an Escape and they sell them for 30k fully loaded, but for some reason it's the union workers who are making them go broke??? BULLSHIT That 11k also includes operator pay.(The people building the damn cars.)
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OK, maybe I'm missing something, but $55.00 x 40 hours x 52 weeks = $114,400!!!
Tell me it's the "new math" or something, but $114k a year to build cars?!?! ****, sign me up!!
On a side note, I am glad that Ford is working to get their costs in line, but geez, that's still crazy.
Any lawyers on the board? Tell me why we can't "fire" the union and pay them a respectable rate? Does the union have a legal right to exist and demand a wage? What would happen in GM fired all union workers and re-hired non-union workers at have the pay? Lawsuit city? What's the basis?
Tell me it's the "new math" or something, but $114k a year to build cars?!?! ****, sign me up!!
On a side note, I am glad that Ford is working to get their costs in line, but geez, that's still crazy.
Any lawyers on the board? Tell me why we can't "fire" the union and pay them a respectable rate? Does the union have a legal right to exist and demand a wage? What would happen in GM fired all union workers and re-hired non-union workers at have the pay? Lawsuit city? What's the basis?
#17
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1. Your name is 88blackgt, which means you've got a 5.0 and are on a GM website. No offense to anyone with a mustang with over 300hp.
2. I don't know too many highschoolers who can paint a car just because they have a 4.0 grade average.
3. I doesn't take advertising in racing or on tv to sell cars anymore. DUH
4. You don't know the real meaning of the word "Dense".
5. only 3% of the prototypes made have anything to do with actual real world ****, the rest is just to show off skills and new concepts, which at a time like this is a waste of money.
6. When you say train a monkey you sound retarded. They're Chimps, the closest animal geneticly to a homosapian.
Maybe you should graduate highschool before you get on a forum with adults little boy.
#18
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If that's so expensive why are they still making prototypes, sponsoring football, racing, etc.
It's funny how they cut the guy on the bottom but continue to put money into the fun stuff. Oh, we'll pay guys to do **** that has nothing to do with building an automobile, but the men and women who get dirty every day or nite can eat ****....
ChaseSS is also from St. Louis where they shut a plant down. Gee I wonder why, with people like that in the area I have a hard time seeing any company being successfull.
It's funny how they cut the guy on the bottom but continue to put money into the fun stuff. Oh, we'll pay guys to do **** that has nothing to do with building an automobile, but the men and women who get dirty every day or nite can eat ****....
ChaseSS is also from St. Louis where they shut a plant down. Gee I wonder why, with people like that in the area I have a hard time seeing any company being successfull.
There are cuts going throughout the entire company and everyone is going to feel it from management to the bottom level worker. I think poor management should be replaced or take a more sever pay cut compared to employee's, granted this isn't always the case.
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It's a good thing you've got the internet to call people names, because I bet you're a little bitch in the real world.
What's funny is these people who talk about **** they have no clue about. I'm glad god put dumb people on earth(ChaseSS) I love laughing at them!!!
You know that Henry Ford wanted his employees to be able to afford the vehicles they produce, Good luck affording anything when they take away half your pay!!!
What's funny is these people who talk about **** they have no clue about. I'm glad god put dumb people on earth(ChaseSS) I love laughing at them!!!
You know that Henry Ford wanted his employees to be able to afford the vehicles they produce, Good luck affording anything when they take away half your pay!!!
I love arguing with people that use ZERO facts to back anything they claim. Your obviously in the minority thinking that the UAW has a place and an argument to keep raping the big 3 with total cost per labor upwards of $70. And if you haven't noticed, Henry Ford doesn't run the company anymore and if you can't afford a Focus, you have bigger problems than arguing with me on the internet. The fact is that you have no business experience or education in the matter and everything you post is useless information. Then you stoop to the level of making fun of someones screen name (88blackgt)???? Are you seriously even old enough to drive?
3. I doesn't take advertising in racing or on tv to sell cars anymore. DUH
my suggestion: quit posting because your making yourself look like a complete tool
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You're obviously not very smart are you. I'll give you some reasons why.
1. Your name is 88blackgt, which means you've got a 5.0 and are on a GM website. No offense to anyone with a mustang with over 300hp.
2. I don't know too many highschoolers who can paint a car just because they have a 4.0 grade average.
3. I doesn't take advertising in racing or on tv to sell cars anymore. DUH
4. You don't know the real meaning of the word "Dense".
5. only 3% of the prototypes made have anything to do with actual real world ****, the rest is just to show off skills and new concepts, which at a time like this is a waste of money.
6. When you say train a monkey you sound retarded. They're Chimps, the closest animal geneticly to a homosapian.
Maybe you should graduate highschool before you get on a forum with adults little boy.
1. Your name is 88blackgt, which means you've got a 5.0 and are on a GM website. No offense to anyone with a mustang with over 300hp.
2. I don't know too many highschoolers who can paint a car just because they have a 4.0 grade average.
3. I doesn't take advertising in racing or on tv to sell cars anymore. DUH
4. You don't know the real meaning of the word "Dense".
5. only 3% of the prototypes made have anything to do with actual real world ****, the rest is just to show off skills and new concepts, which at a time like this is a waste of money.
6. When you say train a monkey you sound retarded. They're Chimps, the closest animal geneticly to a homosapian.
Maybe you should graduate highschool before you get on a forum with adults little boy.