Negotiators from the United Automobile Workers and Ford Motor have agreed to terms on a new four-year labor contract, people briefed on the talks said Wednesday, as the union began a growing wave of walkouts against the three Detroit automakers. After about six weeks.
The deal includes about a 25 percent pay raise over four years, those people said. Any agreement would be subject to approval by the UAW council that oversees relations with Ford, and then ratification by the company’s union workers.
The union continues talks with General Motors and Stellantis, whose brands include Chrysler, Jeep and Ram.
Two weeks ago – when it said it had reached the limit it could afford without hurting its business – Ford agreed to raise pay by 23 percent, adjusting pay in response to inflation and raising the top salary for new hires. Offered a reduction in time to arrival, from eight to four years. Other companies have also made similar offers.
But the UAW and its president, Shawn Fenn, have pressed for more concessions, intensifying the walkouts and targeting them at factories making some of the automakers’ most profitable models.
In total, about 45,000 workers at Ford, GM and Stellantis are on strike nationwide, including 8,700 workers at Ford’s Kentucky Truck Plant in Louisville, the company’s largest, and about 10,000 workers at Ford factories in Illinois and Michigan.
The tentative agreement with Ford could increase pressure on other companies to reach a compromise with the union. In the past, once the union reached an agreement with one automaker, temporary agreements were immediately reached with others. But that history may no longer be as relevant because the UAW had never struck all three companies simultaneously until this year.
Companies are investing billions in the transition to battery-powered vehicles, which they say will make it harder to pay significantly higher wages. Last week, Ford’s executive chairman, William C. Ford Jr., said the union’s demands risk hurting Detroit automakers’ ability to compete against non-union companies and foreign rivals like Tesla.
“Toyota, Honda, Tesla and others are loving the strike because they know the longer it goes on, the better it will be for them,” he said. “They’ll win, and we’ll all lose.”
The UAW makes a different case: Success in the contract fight with the Big Three would give it momentum to organize autoworkers at other companies as well.
The UAW began its boycott when the companies’ union contracts expired in mid-September. It received immediate support from President Biden, who called on automakers to “ensure record contracts mean record corporate profits” and joined workers on the picket line at a GM plant near Detroit late last month.
The union had initially sought a 40 percent pay increase over four years — an amount union officials said matches the pay increases top executives at the three companies have received over the past four years. Those increases are also intended to offset more modest raises received by autoworkers in recent years and concessions the union made to companies starting in 2007.
Additionally, the union has called for ending a system that pays new hires little more than half the top wage of $32 an hour. It is calling for a cost-of-living adjustment that would push wages higher to compensate for inflation. And it wants pension restoration, better retirement benefits and shorter working hours for all workers.
GM and Stellantis recently faced UAW walkouts, when the union on Monday called out 6,800 workers at a large Ram pickup truck plant in Michigan and 5,000 workers at a GM plant in Arlington, Texas, which is home to the large sport utility. Makes vehicles. The Chevrolet Tahoe, GMC Yukon and the Cadillac Escalade.
On Tuesday, GM reported third-quarter profit of $3.1 billion, down 7 percent from the same period last year, due in part to the ongoing strike. Ford is scheduled to announce its third-quarter earnings on Thursday.