CFL News
October 05, 2011

Ford to add 2,000 jobs in Chicago area under contract deal

The UAW and Ford reached a tentative agreement on a new contract that will mean 2,000 new jobs in the Chicago area, including 1,100 new jobs and a new shift at the company’s Chicago assembly plant next year if workers approve the deal

Source: Chicago Sun-Times

By Francine Knowles

The UAW and Ford reached a tentative agreement on a new contract that will mean 2,000 new jobs in the Chicago area, including 1,100 new jobs and a new shift at the company’s Chicago assembly plant next year if workers approve the deal, the union and Illinois politicians said Tuesday.

Ford now employs roughly 2,700 workers in Chicago at the Torrence Avenue plant, which produces the Lincoln MKS, Ford Taurus and Ford Explorer on two shifts. It also employs 900 workers at its Chicago Heights stamping plant.

Ford plans to add 1,100 workers at the Chicago assembly plant next year and an additional 900 workers at the stamping plant and assembly plant within the next four years.

It’s part of a plan to add 5,750 factory jobs nationally under the deal, on top of 6,250 Ford announced earlier this year, for a total of 12,000 jobs by 2015. Ford also pledged to invest $4.8 billion in its U.S. factories, including $200 million in the Chicago area.

Voting is expected next week.

“This is a victory for Ford, a victory for workers and a victory for Chicago,” Mayor Rahm Emanuel said in a statement. “It will not only create new jobs and unleash new prosperity in Chicago, but the company’s commitment to manufacture fuel-efficient cars and trucks will help pave the way towards a more energy-independent future.”

“I’m extremely pleased that Ford is strengthening its commitment to the state of Illinois to create 2,000 new jobs and stimulate the economy with an additional $200 million new investment,” Gov. Pat Quinn said in a statement.

“Ford and the UAW have worked together to reach an agreement that — when finalized — will provide a solid increase in jobs and investment. The kind of economic growth in Illinois that this agreement outlines would have multiplying benefits for our communities. My administration looks forward to continue working closely with the UAW and Ford to expand their operations and put more people to work for a new production shift at the Chicago Assembly Plant that could begin early next year.”

If they agree to the contract, Ford’s U.S. workers will get at least $16,700 over the four-year contract, in the form of a $6,000 signing bonus, $7,000 in lump-sum and inflation protection payments and at least $3,700 in profit-sharing this year. That’s more generous than GM’s agreement, which guarantees workers at least $11,500.

Ford’s 41,000 hourly workers will get $1,000 more as a signing bonus than the $5,000 bonus GM workers got under an agreement ratified last month. The GM agreement also gives most workers profit-sharing payments instead of annual raises. Ford’s agreement was expected to follow that pattern.

John Fleming, Ford vice president of manufacturing, said most of the 5,750 additional hires will be paid $19.28 per hour, a fraction of the $28 hourly wage of Ford’s older workers, but up from the $15.51 per hour new hires now get. Ford currently has less than 100 entry-level workers, but will hire thousands more by 2015. The union agreed to a lower wage for entry-level workers in 2007 when the company was losing billions of dollars.

The contract agreement is expected to lower Ford’s labor costs, which are the highest in the U.S. auto industry.

Ford currently pays most of its workers $58 per hour in wages and benefits.

“The tentative agreement will enable us to improve our overall competitiveness here in the United States,” Fleming told reporters at Ford’s headquarters in Dearborn.

The deal will bring some production of the Ford Fusion sedan from Mexico to a factory in Michigan. It also will bring work to the U.S. from China and Japan, Ford said.

Fleming said the $4.8 billion in investments is in addition to $1.4 billion previously announced, for a total of $6.2 billion in investments over the life of the contract.

Approval of the contract could be a problem. There is some anger among Ford members about CEO Alan Mulally’s $26.5 million pay package last year, and many Ford workers feel that the company is healthy enough to offer annual raises and other benefits. Ford earned $6.6 billion last year.

UAW leaders said the contract keeps Ford’s costs and prices competitive while increasing profit sharing.

“We are aware of the competition that Ford and General Motors and Chrysler face,” UAW President Bob King said. “If we are going to succeed in the long run and really be able to have long-run security and decent income for our membership, we can’t put Ford and GM and Chrysler at a competitive disadvantage.”

Talks at Chrysler Group LLC are next and could be more contentious. The company isn’t making as much money as Ford and GM and probably can’t afford the same deals. Chrysler and the UAW have set an Oct. 19 deadline to reach a new contract agreement.

The UAW talks are watched closely because they set wages for more than 112,000 workers in the auto industry and set the bar for pay at auto parts makers and foreign-owned automakers.

Ford shares rose 3 percent, or 32 cents, to $9.69 in early afternoon trading Tuesday.

Contributing: AP