For Bill Ford, ‘every conversation is a roller coaster’

For Bill Ford, 'every conversation is a roller coaster'

As a 25-year-old junior executive at a car company, the pseudonymous William Clay Ford Jr. was introduced to labor negotiations when a union official demanded he stand up and pledge that he was made of the stuff. As is his great-grandfather Henry Ford.

Mr. Ford, now the company’s executive chairman, recalled that moment in an interview this week to describe how he and his company are working on one of their toughest labor negotiations in decades.

The United Automobile Workers union has closed three Ford plants, including its largest, and other plants and distribution centers at Chrysler owner General Motors and Stellantis. The union’s new president, Shawn Fenn, has said he is prepared to call out workers at more plants if their demands for bigger wage increases, better benefits and job security are not met. He has called the companies the “enemy” and said the union is fighting “corporate greed” and standing with the “billionaire class.”

In a speech this week, Mr. Ford said the strikes were helping non-union automakers like Tesla, Toyota and Honda. Mr. Fenn responded that the employees of those companies were future UAW members.

In an interview after his speech, Mr. Ford said he was advising his executives not to let Mr. Fenn’s words get to them and focus on getting a deal done. Mr. Ford also recalled his first difficult conversation with a union official.

In 1982, Mr. Ford said, his father invited him to sit in the room for negotiations with the UAW when, as a newcomer, he was not allocated a seat at a table where about 50 union negotiators were meeting at a Were sitting on one side and same number of Fords were sitting. Officer on the other.

Sitting against the wall, an elderly union representative approached him. “You, stand up,” the man said. “What are you made of? I knew your great-grandfather and your grandfather. I knew what they were made of. What are you made of?”

Mr Ford said he casually replied that he never knew his great-grandfather and grandfather but that he shared their values. Similar confrontations occurred daily – “I lived in fear of going to work,” Mr Ford said.

Then about a week later, union officials invited him to a local bar. “Come with us,” Mr. Ford said he told them. “You have passed the exam.”

This interview was condensed and edited for clarity.

Have you been involved in any negotiations that are comparable to the current negotiations?

No, but every conversation is different, and every leader is different. This is what I keep telling my officers: ‘Don’t take it personally. Most of it is theatre. The most important thing is to close the deal. Rhetoric doesn’t matter. Every negotiation is a roller coaster. Some are not pleasant and some sting. Don’t overreact. And when this is all over, we are still a team again and we have to move forward.

Will you be on the same team at the end of these negotiations?

I believe we will. I know many of the guys on his negotiating team personally and some of them I play hockey with and consider them very close friends.

You’ve said the real competition is not the UAW versus Ford but the UAW and Ford against Toyota, Honda, Tesla and the Chinese automakers. Do you think the union leadership agrees with this?

I hope so, because if they don’t, it would be devastating. They may disagree with us and drive a hard bargain, but we are not the enemy. I will never consider my employees as enemies. I think the employees know who the real competition is and when it’s over they will join us. We made a conscious decision to grow jobs here in the US when our competitors were moving production to Mexico.

Would the proposal now before you put Ford at a significant disadvantage to other automakers?

It will definitely be of no use. We can stick to the deal we’ve proposed, but just barely. If you go beyond this, we have to start taking tough decisions in terms of investments and future products.

Sean Fenn has said that workers have been left behind while automakers and executives such as Jim Farley, chief executive of Ford, and Mary Barra, chief executive of GM, have prospered. How do you react?

Everyone will have their own perspective on executive compensation, and I completely understand that. But I also know what the market is for top talent. You have entertainers and athletes who are making more than Jim Farley and Mary Barra. But that’s the market, and the company with the best talent wins, period.

There were a few lean years when I didn’t take a salary, and I would do it again if I had to.

Three of your plants have been closed due to the strike. How is this affecting your operations?

It’s messy, and it’s getting messier. The most immediate impact will be on suppliers. The supply base is very fragile. It has barely survived Covid, and has not fully recovered, so a prolonged strike will start to collapse the supply base, and then it will become difficult to manufacture anything in this country.

Manufacturing is a matter of national security and we saw this during Covid. And I hope with all my heart that we never get into another war, but if we do, this industry will be vital to the defense of our nation, as it was in World War I and World War II. Other industries may make small numbers of items. Auto companies can turn it into thousands of things.

What is your outlook on the US economy?

I think it’s delicate. Inflation is wreaking havoc. The consumer is still spending, but we are watching it very carefully. On the other hand, there is still strong employment, and we are seeing growth in our sales. Of course, there are conflicting signals.

Let’s talk about electric vehicles. About 18 months ago, you launched the F-150 Lightning pickup. It seemed that the sales of electric vehicles were going to increase. But now Ford is slowing production of that truck. What happened?

EV sales are still up 50 percent this year, so sales are growing very fast. But we have also seen the politicization of EVs. Blue states say EVs are great and we need to adopt them sooner for climate reasons. Some red states say it’s just like the vaccine, and the government is shoving it down our throats, and we don’t want it. I never thought I would see the day when our products would be so heavily politicized, but it has happened.

There are other prices. Electric vehicles are expensive. We know prices will come down, and as soon as that happens, we will have a big ramp-up of EVs. Keep this in mind: The most valuable company our industry has ever seen is Tesla, and it’s growing. It’s a very instructive point when people say EVs are not desirable.

Are you concerned about some of Donald Trump’s comments? He just came to Michigan and said that the transition to electric vehicles will result in almost all auto production being moved to China.

I don’t want to personalize this because, clearly, we have to choose a path forward and our lead time is longer than the political lead time. Therefore, we cannot overreact to rough rhetoric. We have to deal with the most likely scenario, and how can we create the most value for our company, so we’re moving forward with EVs because we believe they have the best applications for a lot of . And once people drive an EV, they will see that it is a great experience.

Electric vehicles are expensive. Did Tesla’s price cut have a big impact on your business?

We have seen this with every new technology that has been adapted. As batteries get better you move down the cost curve much faster.

With our first generation EVs, the Lightning and the Mustang Mach-E, they had a lot of internal combustion engineering done to them. The next generation, which will start arriving very soon, was developed with a clean sheet of paper. When you do that you can really start to figure out the costs, and then you can start pricing accordingly.

Tesla is taking the lead in cutting prices, because they can do so with their scale. This is something we’re really counting on in the future. And we will have products that will compete in that world and make money.

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