UAW: Ford to Save $850M in Health Care Deal
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Posts: 1,960
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UAW: Ford to Save $850M in Health Care Deal
http://news.yahoo.com/s/ap/20051214/...bi_ge/uaw_ford
Sounds familiar.... 
. I wonder if GM has made any progress in this area.
DETROIT - Ford Motor Co.'s retired autoworkers will start making monthly health care contributions and pay deductibles as part of a tentative agreement the automaker reached with the
United Auto Workers, which provided details of the plan Wednesday.
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The UAW announced over the weekend that it had reached the deal with Ford, but details were withheld until Wednesday, after the UAW presented the deal to local union leaders. The agreement is subject to ratification by active members. Voting is scheduled to end Dec. 22.
The agreement raises the cost of prescription drugs and requires hourly workers to make a contribution to a retirement fund. It exempts around 28,000 retired autoworkers whose Ford pension income is $8,000 a year or less.
It also requires Ford to invest $900 million over five years into plant improvements and advanced technology initiatives, such as building hybrid and fuel cell vehicles.
The agreement is expected to save Ford $850 million annually on a pretax basis, the UAW said.
UAW President Ron Gettelfinger said the union reviewed Ford's finances before agreeing to the changes.
"We put an agreement together that we believed was necessary," Gettelfinger said. "We think it's the responsible thing to do in the current climate in which we find ourselves competing."
A message seeking comment was left with a Ford spokesman.
Ford is the second automaker agree a health care pact with the UAW this year. Last month, General Motors Corp. hourly workers voted in favor of an agreement that requires workers and retirees to pay more for their health care. The UAW and GM reached that agreement after months of negotiations.
The UAW said it will now negotiate a similar agreement with DaimlerChrysler AG.
Dearborn-based Ford reported a third-quarter loss of $284 million. The No. 2 U.S. automaker has been struggling to meet its health care obligations as its U.S. market share declines.
Ford spent about $3.1 billion to cover 550,000 hourly and salaried workers, retirees and dependents in 2004 and expects that total to rise to $3.5 billion this year.
The health care agreement is only part of a major restructuring plan Ford expects to announce in January. The company has said job cuts and plant closures will be part of that plan.
Gettelfinger said the union doesn't yet know any details about that plan.
"I think they're being slow and meticulous for a reason. I think they're working really hard for a plan they think will move them forward," Gettelfinger said.
Ford shares rose 1 cent to $8.14 in afternoon trading on the
New York Stock Exchange. They have been trading in a 52-week range of $7.57 to $15.
United Auto Workers, which provided details of the plan Wednesday.
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The UAW announced over the weekend that it had reached the deal with Ford, but details were withheld until Wednesday, after the UAW presented the deal to local union leaders. The agreement is subject to ratification by active members. Voting is scheduled to end Dec. 22.
The agreement raises the cost of prescription drugs and requires hourly workers to make a contribution to a retirement fund. It exempts around 28,000 retired autoworkers whose Ford pension income is $8,000 a year or less.
It also requires Ford to invest $900 million over five years into plant improvements and advanced technology initiatives, such as building hybrid and fuel cell vehicles.
The agreement is expected to save Ford $850 million annually on a pretax basis, the UAW said.
UAW President Ron Gettelfinger said the union reviewed Ford's finances before agreeing to the changes.
"We put an agreement together that we believed was necessary," Gettelfinger said. "We think it's the responsible thing to do in the current climate in which we find ourselves competing."
A message seeking comment was left with a Ford spokesman.
Ford is the second automaker agree a health care pact with the UAW this year. Last month, General Motors Corp. hourly workers voted in favor of an agreement that requires workers and retirees to pay more for their health care. The UAW and GM reached that agreement after months of negotiations.
The UAW said it will now negotiate a similar agreement with DaimlerChrysler AG.
Dearborn-based Ford reported a third-quarter loss of $284 million. The No. 2 U.S. automaker has been struggling to meet its health care obligations as its U.S. market share declines.
Ford spent about $3.1 billion to cover 550,000 hourly and salaried workers, retirees and dependents in 2004 and expects that total to rise to $3.5 billion this year.
The health care agreement is only part of a major restructuring plan Ford expects to announce in January. The company has said job cuts and plant closures will be part of that plan.
Gettelfinger said the union doesn't yet know any details about that plan.
"I think they're being slow and meticulous for a reason. I think they're working really hard for a plan they think will move them forward," Gettelfinger said.
Ford shares rose 1 cent to $8.14 in afternoon trading on the
New York Stock Exchange. They have been trading in a 52-week range of $7.57 to $15.
. I wonder if GM has made any progress in this area.
Last edited by MarcR94v6; Dec 14, 2005 at 06:17 PM.
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Joined: Mar 2001
Posts: 13,713
From: The Golden State
Re: UAW: Ford to Save $850M in Health Care Deal
Ford's ahead of the curve here because the UAW likes Bill Ford.
Although it's more PR than anything else, when I guy gives up his salary till the company becomes profitable (yea I know... stock options), and his name is on the side of the building, they take him far more seriously than a hired hand playing hardball with the union on one side and collection multi million dollar paychecks on the other.
Although Chrysler is turning profits, they have already wiped out well over a third of their workforce some time ago, so they are already in great shape.
Although it's more PR than anything else, when I guy gives up his salary till the company becomes profitable (yea I know... stock options), and his name is on the side of the building, they take him far more seriously than a hired hand playing hardball with the union on one side and collection multi million dollar paychecks on the other.
Although Chrysler is turning profits, they have already wiped out well over a third of their workforce some time ago, so they are already in great shape.
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Joined: Nov 2001
Posts: 483
From: Far, far away
Re: UAW: Ford to Save $850M in Health Care Deal
Originally Posted by guionM
Ford's ahead of the curve here because the UAW likes Bill Ford.
Although it's more PR than anything else, when I guy gives up his salary till the company becomes profitable (yea I know... stock options), and his name is on the side of the building, they take him far more seriously than a hired hand playing hardball with the union on one side and collection multi million dollar paychecks on the other.
Although Chrysler is turning profits, they have already wiped out well over a third of their workforce some time ago, so they are already in great shape.
Although it's more PR than anything else, when I guy gives up his salary till the company becomes profitable (yea I know... stock options), and his name is on the side of the building, they take him far more seriously than a hired hand playing hardball with the union on one side and collection multi million dollar paychecks on the other.
Although Chrysler is turning profits, they have already wiped out well over a third of their workforce some time ago, so they are already in great shape.
Yep, yep. When you keep making tons of money every year the prospect of paying for healthcare for the rest of an employees life doesnt scare you so much. Then decades pass, the cost of health care goes up 100x and suddenly you are up a creek with a very small paddle. I really think GM is going to be hurting from this health care stuff for a long long time.
I rag on Ford for doing what he did only because the guy is obviously very smart. He knew it would help FoMoCo out a lot in terms of relationships with workers, and I suppose it just bugs me that so many people are fooled by it. Very good move on his part though as it helped out a lot in these negotiations I am sure. I'm envious in a way because he got away with the kind of thing I would do in his situation.
How did Chrysler get rid of so many of their workers? I didn't know that. Care to explain?
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