LDN - Business

UAW turns to Ford after GM workers approve new contract

[October 26, 2019] By Ben Klayman and David Shepardson

DETROIT/
WASHINGTON (Reuters) - The United Auto Workers union said on Friday it has chosen Ford Motor Co <F.N> as the next U.S. automaker the union will negotiate with after workers at General Motors Co <GM.N> approved a new contract deal.

The UAW said 57% of hourly workers at GM voted to approve the deal to end a contentious 40-day U.S. strike, the longest automotive labor stoppage since 1970.

GM Chairman and Chief Executive Mary Barra said in a statement the new contract "recognizes our employees for the important contributions they make to the overall success of the company, with a strong wage and benefit package and additional investment and job growth in our U.S. operations."

The UAW and Ford, the second-largest U.S. automaker, will begin talks on Monday, the union said. Ford and the UAW said earlier this month they had made "significant progress" in addressing many bargaining issues.

Ford said on Friday it looks "forward to reaching a fair agreement that helps Ford enhance its competitiveness and preserve and protect good-paying manufacturing jobs."

Unlike GM, Ford has not signaled it wants to close plants, but executives have said future electric vehicles would require 30% fewer labor hours to build. UAW leaders have expressed concern about the impact of EVs on their members.

GM also did little to lower its share of the UAW's healthcare plans, which could be more costly to Ford since it employs about 55,000 UAW members in the United States.

The UAW had previously agreed to a temporary contract extension with Ford while it focused on GM.

While the talks between GM and the UAW grew tense at times, with the union accusing the automaker of trying to "starve ... workers off the picket lines," Ford historically has had an easier relationship with the union. Ford Executive Chairman Bill Ford has described the UAW as "family" in the past and in September 2018 hailed the No. 2 U.S. automaker's relationship with its hourly workers.

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"UAW on strike" picket signs lay on a pile of wood outside the General Motors Detroit-Hamtramck Assembly in Hamtramck, Michigan, U.S. October 25, 2019. REUTERS/Rebecca Cook

"The UAW doesn't just make our workers better, it makes Ford better and stronger," Bill Ford told UAW workers last year.

Workers at GM will begin to go back as early as Saturday under the new four-year contract, ending the strike that cost the No. 1 U.S. automaker more than $2 billion and costing the automaker about 300,000 units of lost production. GM will attempt to make up some of that production in the coming months.

The union wrung higher pay and other benefits from GM as part of the deal to end the strike by about 48,000 workers.

UAW leaders had recommended that the members at GM, who have remained on the picket lines, ratify the deal reached on Oct. 16.

The GM strike began on Sept. 16, with UAW negotiators seeking higher pay for workers, greater job security, a bigger share of profit and protection of healthcare benefits. Other issues included the fate of plants GM targeted to close, as well as the use of lower-paid temporary workers.

The strike at GM likely slashed at least 46,000 jobs from October's nonfarm U.S. payrolls, the Labor Department said on Friday.

Under the deal, GM will invest $9 billion in the United States, including $7.7 directly in its plants, with the rest going to joint ventures. The Detroit company said it will also create or retain 9,000 UAW jobs, a substantial portion of which will be new, a source previously said. The contract offers $11,000 signing bonuses to members, and pay raises.

The UAW previously agreed to temporary contract extensions with Ford and Fiat Chrysler Automobiles <FCHA.MI> <FCAU.N> while it focused on GM.

(Reporting by Ben Klayman in Detroit and David Shepardson in Washington; Editing by Nick Zieminski and Matthew Lewis)

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