Ford deal: $10,000 at signing, $9B promised investment

Ford and UAW reach one of the richest agreements in their history with bigger bonuses than GM or FCA

Alisa Priddle and Brent Snavely
Detroit Free Press

The UAW reached a tentative agreement with Ford on Friday that provides job security and substantial economic gains including bonuses unique to the Ford agreement.

Ford workers will be eligible for about $8,500 in signing bonuses as well as other goodies including profit sharing, a $1,500 annual inflation protection bonus and possible $250 annual competitiveness bonus, according to people familiar with the deal.

Additionally, $1,500 of the profit sharing amount due would be pulled ahead so that workers would get a tidy $10,000 upon ratification.

The agreement also includes:

  • $70,000 retirement bonuses for some workers
  • Commitment to add up to 1,200 skilled trades apprentices 
  • $9 billion in total investment commitments including plans to build the Ford Ranger at the Michigan Assembly Plant when production of the Focus and C-Max families of vehicles stop in 2018.
  • Same raises offered to long-time General Motors and Fiat Chrysler Automobiles workers: 3% raises in the first and third years and 4% lump sum bonuses in the second and fourth years.
  • Path to bring entry-level workers to the full wage scale within eight years
  • Profit sharing continues to follow the current formula but there would no longer be a cap on the amount workers could get which could prove to be sizable in this red-hot North American market.

The Ford logo shines on the front grille of a Ford F-150, on display at a local dealership in Hialeah, Fla.

"This agreement is significant for our members in that it creates a clear path for economic advancement for active members and rewards veteran employees for their sacrifices in recent years,” said UAW Vice President Jimmy Settles. “It is one of the richest agreements in the history of UAW-Ford.”

The union announced Friday afternoon that an agreement had been reached that morning.

GM-UAW deal likely approved after key votes

Union leaders will meet in Detroit on Monday at 10 a.m. to review the deal. If they endorse it, full details will be released, and it will go to the membership for ratification. Meeting dates have not been set.

"I know this has been a very long and stressful process, but I thank each of the 52,000 hardworking men and women of UAW-Ford for their patience, understanding and solidarity," said UAW vice president Jimmy Settles.

As the last of the three Detroit automakers to reach a deal, Ford workers have had had time to build big expectations. Those flames have been fanned by Settles and the Ford bargaining team who early on released videos and messages saying that it's workers' time to be paid back for a decade of concessions.

Done deal: UAW confirms ratification of FCA contract

UAW President Dennis Williams said, "We negotiated for a proposal that will solidify job security and create substantial economic gains for our hard-working members and their families.”

UAW: Ford workers look favorably on terms of GM deal

Ford responded: "The agreement, if ratified, will help lead the Ford Motor Company, our employees and our communities into the future,” said John Fleming, Ford executive vice president, Global Manufacturing and Labor Affairs.

The news comes on the final day of voting for General Motors workers on their four-year agreement.The agreement received enough votes to be ratified by production workers. The final fate rested in the hands of skilled workers who did not favor the deal.

Ford workers on social media have demanded that they get higher bonuses than GM workers, even though GM posted higher North American third-quarter profits than Ford and GM also has a lower labor cost advantage already.

Heading into the talks, the average labor cost, including benefits, for a Ford worker was about $57 an hour, according to the Center for Automotive Research while it was only $55 an hour at GM and $47 an hour at Fiat Chrysler. FCA CEO Sergio Marchionne has indicated the new contract will add about $1.8 billion in additional labor costs over the course of the agreement. GM and Ford costs will be higher.

“GM was a pretty rich agreement," said Kristin Dziczek, director of the Labor & Industry Group of the Center for Automotive Research. "But often the one batting cleanup wants more and members at Ford have very high expectations. They didn’t go through bankruptcy so they don’t feel they should be subject to the same restraints on their agreement as the companies that did."

Jimmy Settles, UAW, Vice President.  Jessica J. Trevino/Detroit Free Press

The previous contract for the three automakers was to expire Sept. 14 and was extended as the talks continued past the deadline.

While main table talks concentrated on one company at a time, Ford talks continued in the background, making it possible to announce a new proposed agreement today, just as GM is wrapping up its ratification process.

“I’m guessing they’ve been done negotiating for awhile,”  said Art Wheaton, director of labor and environmental programs at Cornell University School of Industrial and Labor Relations. “Jimmy Settles saw that GM workers had probably ratified their agreement and said, ‘okay we’re done.’”

Contact Alisa Priddle: 313-222-5394 or Follow her on Twitter @AlisaPriddle