DETROIT (AFP)--The United Auto Workers said Tuesday workers from
the Ford Motor Co. (F) will be the first to vote on a new round of
contract concessions that could save the company more than $1.6
billion in 2010.
The UAW Ford National Council voted unanimously to recommend the
membership ratify proposed modifications to the 2007 UAW-Ford
National Agreement, the union said in a statement.
"Everyone is going to go along with the concessions," predicted
one former union official, after a meeting of the union's Ford
National Council Tuesday.
The tenative deal, to be voted on by March 9, would allow Ford
to fund up to 50% of its outstanding obligations to a multibillion
dollar retirees health care plan with stock instead of cash.
If approved by Ford's 42,000 workers across the U.S., the deal
could save Ford $1.6 billion in cash next year.
Under the terms of the 2007 agreement, Ford had been expected to
transfer $3.2 billion into the Voluntary Employee Beneficiary
Association in 2010.
The new deal would also eliminate two paid holidays, scrap two
one-time productivity bonuses due next year, end the quarterly
cost-of-living wage adjustments and slap new limits on supplemental
unemployment benefits that workers have been paid for half a
century.
While Ford hasn't asked for government aid, it has used the deep
recession in the global auto industry to seek concessions from the
union.
The UAW also plans to offer similar terms to both General Motors
and Chrysler LLC, sources indicated. Officials from Chrysler and
GM, which last week asked for more than $21.6 billion in government
loans to stave off bankruptcy, declined to comment on the Ford
deal.
The UAW has always enjoyed better relations with Ford than with
cash-strapped Chrysler and General Motors and the union is using
the negotiations with Ford to shield itself from demands for more
concessions from the other two automakers.
Both companies are supposed to have deals with the union wrapped
up by March 31, by which time they must convince the U.S.
government that they are viable in the long-term or risk having the
administration call in the loans.
The Detroit Three reached a deal with the UAW in 2005 to
transfer responsibility for retiree health care befits to the union
by setting up the health care plan.
Ford said at the time it would be able to reduce its overall
health care liability by $5 billion as a result of the deal, which
it estimated would also produce an average annual net corporate
savings of about $650 million.