A senior Ford executive said Thursday the automaker is “on the limit” of what it may possibly spend on higher wages and advantages for the United Auto Staff, and warned the union’s strike at the corporate’s most profitable factory could harm staff and slash profits.
“Now we have been very clear that we’re on the limit,” Kumar Galhotra, head of Ford’s combustion vehicle unit, said during a conference call Thursday. “We stretched to get so far. Going further will hurt our ability to take a position within the business.”
Ford is open to reallocating money inside its current offer in further bargaining with the union to secure an agreement, Galhotra said.
Ford can be working with the UAW on a method to bring staff at joint-venture electric vehicle battery plants into the UAW-Ford agreement, he said.
UAW President Shawn Fain on Wednesday ordered a strike at Ford’s Kentucky Truck factory after Ford negotiators didn’t present a richer contract proposal.
UAW negotiators turned their attention on Thursday to talks with Chrysler parent Stellantis, union President Shawn Fain said, confirming a Reuters report.
Ford is working with the UAW on a method to bring staff at joint-venture electric vehicle battery plants into the UAW-Ford agreement.REUTERS
“Here’s to hoping talks at Stellantis today are more productive than Ford yesterday,” Fain wrote on social media. Stellantis didn’t immediately comment.
The standoff between the UAW and Ford could soon affect 1000’s of staff who usually are not among the many nearly 34,000 Detroit Three staff Fain has ordered to walk off the job since Sept. 15.
About 4,600 Ford staff may very well be idled because their jobs rely upon production of Super Duty pickups and enormous Lincoln and Ford SUVs at Kentucky Truck, said Ford manufacturing vp Bryce Currie.
Already, 13,000 staff at Ford suppliers have been furloughed due to earlier UAW walkouts at two Ford assembly plants, Ford supply chain chief Liz Door said.
The shutdown of Kentucky Truck, Ford’s largest factory, could push a fragile supply chain “toward collapse,” she said.
Fain and other UAW officials have countered that Ford, General Motors and Stellantis can afford to extend pay for UAW staff beyond the 20% to 23% they’ve offered, end lower wage tiers for lower seniority and temporary staff, and restore defined profit pensions lost in 2007 in the event that they rein in share buybacks and cut excessive executive pay.
UAW President Shawn Fain on Wednesday ordered a strike at Ford’s Kentucky Truck factory.AP
The walkout at Kentucky Truck was a pointy escalation within the UAW’s slow-building campaign of strikes, and sent a warning to Stellantis and General Motors, whose wage and advantages offers fall in need of Ford’s, based on summaries the automakers and the UAW have released.
Fain has scheduled a video address for Friday at 10 a.m. In past weeks, Fain has used Friday addresses to order additional walkouts, or announce progress in bargaining.
Fain has yet to tip his hand as to what actions he’ll take Friday, if any.
Some analysts saw Fain’s decision to shut down Ford’s Kentucky Truck plant, which builds Super Duty pickups and Lincoln Navigator SUVs, as an indication that the endgame may very well be starting within the nearly month-long round of coordinated walkouts on the Detroit Three.
“Pressure was all the time needed to force a deal,” Evercore ISI analyst Chris McNally wrote in a note on Thursday.
About 4,600 Ford staff may very well be idled because their jobs rely upon production of Super Duty pickups and enormous Lincoln and Ford SUVs at Kentucky Truck.REUTERS
White House press secretary Karine Jean-Pierre said the administration was closely monitoring the economic impact of the widening strike and still hoped either side will reach a “win-win agreement.”
Last Friday, Fain said if needed, the UAW would strike the GM assembly plant in Arlington, Texas, that builds Cadillac Escalade, Chevy Suburban and other large, high-priced SUVs. GM’s Flint, Michigan, heavy-duty truck assembly plant is one other potential strike goal.
High-profit targets at Stellantis include the automaker’s Ram pickup truck factories in Sterling Heights and Warren, Michigan, in addition to two Jeep SUV factories in Detroit.
“This puts everybody on notice,” said Sam Fiorani, vp of world vehicle forecasting at AutoForecast Solutions. “In the event that they haven’t brought anything latest to the table since last week, GM and Stellantis must be fearful.”
Analysts at Wells Fargo estimated that Ford will lose about $150 million per week in core take advantage of the Kentucky plant strike.
Some analysts saw Fain’s decision to shut down Ford’s Kentucky Truck plant as an indication that the endgame may very well be starting within the nearly month-long round of coordinated walkouts on the Detroit Three.REUTERS
Ford officials said on Thursday that cutting a deal that doesn’t allow the corporate to survive is unnecessary and that striking the Kentucky truck plant would also hurt the UAW’s profit-sharing checks.
In an indication of the strike’s expanding impact, Delta Air Lines said on Thursday it’s feeling a pinch from the automotive and entertainment labor strikes.
Delta President Glen Hauenstein said the UAW strike has curtailed a “significant” amount of business in Detroit.
Automakers have greater than doubled initial wage hike offers, agreed to boost wages together with inflation and improved pay for temporary staff, however the union wants higher wages still, the abolishment of a two-tier wage system and the expansion of unions to battery plants.
The UAW has room to expand its walkouts and increase the pressure on the Detroit Three to supply larger wage gains, richer retirement packages and more assurances that latest electric vehicle battery plants might be unionized.
Even with 8,700 staff at Ford’s Kentucky Truck plant now on strike, lower than 1 / 4 of the 150,000 UAW staff on the Detroit Three automakers are actually on strike.
Nevertheless, 1000’s more have been furloughed from jobs at operations that usually are not on strike because automakers said the walkouts made their work unnecessary.
Ford said on Thursday that it already had 13,000 layoffs at its suppliers and that 4,600 of its own staff may very well be laid off at other plants.
Ford warned that staff at a dozen other factories may very well be sent home due to truck plant walkout.
Officials said latest layoffs stemming from the Kentucky strike could begin in the approaching days.
Ford said on Thursday that it already had 13,000 layoffs at its suppliers and that 4,600 of its own staff may very well be laid off at other plants.REUTERS
Its Kentucky truck plant, the corporate’s most profitable operation, generates $25 billion in annual sales, a few sixth of Ford’s global automotive revenue.
Fain and other UAW officials called a gathering with Ford at on Wednesday evening and demanded a latest offer, which Ford didn’t have, a Ford official said.
“You only lost Kentucky Truck,” Fain said, in keeping with the Ford official and a union source, speaking on condition of anonymity since the talks usually are not public.
Ford said the choice was “grossly irresponsible.”
Fain has said his aim is to maintain the automakers off-balance by taking targeted motion somewhat than a full strike.
The Detroit automakers will report third-quarter financial results between Oct. 24 and Oct. 31, and the UAW could use what are expected to be robust profits to press their case for a richer contract.
Before Wednesday’s Ford announcement, the union had ordered walkouts at five assembly plants, including two Ford assembly plants, on the three firms and 38 parts depots operated by GM and Stellantis.
