Ford’s Plan to Cut Costs Falls Short in Union Vote
- From: Jim_Higgins <gordian238@xxxxxxxxxxx>
- Date: Sat, 31 Oct 2009 15:18:38 -0700
Ford’s Plan to Cut Costs Falls Short in Union Vote
http://www.nytimes.com/2009/11/01/business/01auto.html?hp
DEARBORN, Mich. — Union workers at the Ford Motor Company have refused to help the company make more cuts to its labor costs.
Changes to the workers’ contract that would have allowed the cuts appeared headed for certain defeat Saturday after about 72 percent of workers voted to reject the deal, according to a tally compiled by The New York Times from results at separate plants.
Ford needed 9,000 more votes for passage, with fewer than 7,000 votes outstanding to be either cast or counted through Sunday.
Ford, which said it needed the changes to reduce some advantages the union gave to General Motors and Chrysler as those companies headed into bankruptcy in the spring, is not expected to seek a new deal.
The Ford proposal, which was supported by the union’s leadership, would have frozen the pay of newly hired workers and banned the union from striking in order to demand higher pay or benefits until 2015. Some job classifications also would have been combined, giving Ford more flexibility to shuffle workers around.
In return, Ford promised to pay each worker a $1,000 bonus in March 2010 and to guarantee the assignment of new products to some plants, creating or saving a total of about 7,000 jobs, according to calculations by union leaders.
A person with knowledge of the private negotiations said Ford had already achieved most of the savings it needed in a deal the union approved in the spring. Ford said that earlier deal would save it about $500 million a year. The changes proposed in the latest vote would have saved far less.
A Ford spokesman, Mark Truby, said the company would not comment until the union released official results. That is expected by Monday, when Ford also plans to report its third-quarter earnings. Ford posted a $2.3 billion profit in the second quarter, although it remains deeply in debt.
The president of the United Auto Workers union, Ron Gettelfinger, told reporters Friday that he did not plan to seek a revote.
The workers’ refusal to accept what would have been a third round of concessions since 2007 shows that, despite their industry’s troubles, there is a limit to how much they are willing to sacrifice, said Harley Shaiken, a labor expert at the University of California, Berkeley.
“It’s a hard sell in this environment,” he said. “You’ve got the Ford paradox, where they are hailing how successful they are in the marketing, and that’s obviously paying off for them, but they’re asking more from their workers.”
Many workers interviewed before the vote said they had yet to see benefits they were promised in the March deal even as they were being asked to change their contract again.
The deal’s failure means Ford retains the right to contract some work to other companies or to plants in other countries with lower labor costs.
That worries Marvin Shine, a union official at the U.A.W. Local 600, which represents workers at Ford’s sprawling Rouge manufacturing complex in Dearborn, Mich. About 93 percent of workers at the pickup truck assembly plant there voted against the deal, based on the early results.
“A lot of people are voting it down, and I can’t understand why because there’s no giveaways in it,” Mr. Shine said. “It’s a shame that there’s a possibility we could lose these jobs for no reason.”
But Dave Baran, who has a maintenance job at the Rouge complex, said he was unmoved by Ford’s argument that it needed to follow the lead of its domestic rivals, even though Ford was the only Detroit carmaker to avoid bankruptcy and a federal rescue.
“The company’s doing good,” said Mr. Baran, a 30-year employee at Ford. “Why do we have to be on the same plateau as Chrysler and G.M.? We’re different now.”
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Ford deal with UAW goes down to defeat
http://tinyurl.com/ybe62mc
In a fatal blow to an accord with Ford Motor Co., United Auto Workers members at three of the automaker's largest locals voted Friday against ratification of the proposed contract changes.
At the Dearborn Truck Plant, 93 percent of the votes were cast against the agreement; 53 percent of workers casting their ballots at the Romeo Engine Plant voted against the deal. And at UAW Local 862 in Louisville, which represents workers at both the Louisville Assembly Plant and Kentucky Truck Plant, 84 percent voted no.
Though UAW voting will not be completed nationwide until Sunday, enough plants now have rejected the deal to make it virtually impossible for the agreement to win enough votes for approval.
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"I think it's over," said Gary Walkowicz, one of union dissidents who has led the opposition to ratification. "People are saying 'No more.' We've had enough concessions already. We've given up enough already."
While the UAW pact is headed for defeat, the Canadian Auto Workers announced a tentative agreement Friday with Ford that matches concessions union members already gave to General Motors Co. and Chrysler Group LLC.
UAW members at Ford have been angered by language that limits the union's right to strike over pay and benefit increases in the next round of national contract talks in 2011.
Workers at GM and Chrysler already approved a much broader "no strike" clause as part of agreements negotiated during those companies' government-mandated bankruptcy reorganizations earlier this year.
Union dissidents say Ford already is doing better than GM and Chrysler and does not warrant the same treatment.
But UAW leaders say giving Ford at least a measure of parity with its cross-town rivals is essential to ensuring the continuation of pattern bargaining.
CAW President Ken Lewenza made a similar pitch to his members Friday.
"Pattern bargaining has done wonders for our members, and it stays in place," he said of the new deal with Ford. "Without a pattern, Ford would be trying to extract more from our members."
Deal means more work
The tentative agreement between Ford and the CAW exactly matches the terms the union negotiated with GM and Chrysler as a condition of the Canadian government's bailout of those automakers earlier this year -- including a wage freeze for the life of the contract, a freeze on cost-of-living adjustments after June, the elimination of one paid week off and increased insurance co-payments.
In exchange, Ford agreed to add additional work at its Windsor engine factory and committed to bring a new global platform to its Oakville Assembly Plant sometime after 2012. About 10 percent of Ford's North American production will remain in Canada, which is equal to its sales there.
But Ford will close its assembly plant in St. Thomas, Ontario, in September 2011 when production of the Ford Crown Victoria and Lincoln Town Car ends. That means approximately 1,400 Ford CAW members there will lose their jobs, along with about 6,000 workers employed by suppliers and other companies that support Ford's operations there, according to the union.
"This is devastating for Canada," Lewenza acknowledged, though he said the CAW had negotiated "good" severance benefits for its members, along with a commitment by Ford to offer early-retirement packages at its plants in Windsor and Oakville that could create openings for workers who want to stay at Ford.
Lewenza said the only alternatives were much worse.
"They actually talked about disinvesting in Canada if we didn't extend the pattern to them," he said.
"Our costs are high, relative to U.S. plants -- particularly given the strength of the loonie."
Workers at some UAW plants that voted against the new deal with Ford also are worried that they could lose work if the agreement fails to win ratification.
UAW members at Ford's axle factory in Sterling Heights began circulating a petition Friday calling for a revote after local leaders warned that Ford could transfer new products promised to that plant to a German supplier.
However, UAW President Ron Gettelfinger told reporters later that he would not approve another vote.
More locals reject Ford pact
On Thursday, workers at three more U.S. Ford factories voted against the proposed contract changes, which also would freeze wages and benefits for new hires and give the company greater flexibility in how it deploys employees.
Workers at two Chicago-area complexes soundly rejected the modifications Thursday, as did UAW members at Ford's parts factory in Saline.
Approximately 80 percent of workers at UAW Local 588, which represents workers at Ford's Chicago Stamping Plant, voted against the deal, while 70 percent voted no at UAW Local 551, which represents the Chicago Assembly Plant. At Saline, 75 percent of workers voted against ratification.
While the UAW is not releasing official figures until voting is completed, at least 11 locals now have rejected the agreement. At least four have voted in favor of ratification. A simple majority of Ford's 41,000 UAW-represented workers must approve the deal for it to pass.
While Lewenza stressed that the UAW vote is "not relevant to our decisions here," he said CAW members are certainly aware of the surprise opposition to the U.S. agreement. But he urged them to think differently.
"Our members face a critical choice," Lewenza said.
"Ford is not in good financial shape. ... They have a lot of debt."
What Ford does have, he said, is new product that is beginning to win back consumers in both Canada and the United States, and he said workers need to do what they can to help the company's turnaround succeed.
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