The United Auto Workers union is expected to announce a new tentative labor contract with $Ford Motor(F.US)$ on Wednesday night after intense bargaining throughout the day, according to people with knowledge of the talks.
The UAW, now in the sixth week of its strike at the three Detroit automakers, has called for work stoppages at three Ford factories and sent more than 16,000 U.S. factory workers at the Dearborn, Mich., based car company to picket lines.
The two sides have moved closer on key bargaining issues in recent days, the people said.
As part of the proposed contract, Ford has agreed to give factory workers a 25% wage increase over the life of the agreement, including a 11% bump in the first year, according to people familiar with the details. The wage increase would bump the top pay for assembly line workers from around $32 an hour to roughly $40 an hour.
The UAW has also reduced the time it takes for new hires to reach the maximum wage, reducing it to three years from eight previously.
Union leaders are expected to take several days to review the details of any tentative deal that is reached before the UAW makes it public, some of the people said. It is unclear how soon workers would return to the factories, following a proposed labor deal.
The membership must approve the tentative agreement with a majority vote for it to be officially adopted. The contract, which would span more than four years, covers about 57,000 union-represented workers at Ford.
The UAW was poised to strike the Michigan plant where Ford produces the F-150 pickup truck on Tuesday. However, the automaker moved enough at the bargaining table to avoid the walkout, people familiar with the matter said.
The union and the companies have been bargaining for months to reach new labor deals for about 146,000 U.S. factory workers, in a contentious round of talks that have resulted in UAW leaders and company executives clashing publicly.
The UAW early on came out with some aggressive demands, including a 40% wage hike over four years for its members that would be its largest increase in recent memory. The union has since shown a willingness to budge on its earlier expectations.
Ford's most recent public offer to the UAW included a 23% general wage increase, the return of cost-of-living adjustments to protect against inflation and a quicker progression to top wage for full-time employees.
Executive Chair Bill Ford called the proposal a record offer that would make UAW employees among the best paid in the world. He also called on the UAW to resolve the "acrimonious" talks, emphasizing that the automaker has to be competitive with its foreign-based rivals and Tesla to support factory workers.
Ford has previously had relatively positive relationships with the UAW, and its last national UAW walkout was more than 40 years ago. But UAW President Shawn Fain responded to the Ford chair by saying the UAW isn't willing to work with the company the way it did in the past.
"I want to be crystal clear on one thing. The days of the UAW and Ford being a team to fight other companies are over. We won't be used in this phony competition," Fain said in a livestream address earlier this month.
The union ratcheted up its strike at $General Motors(GM.US)$ and Chrysler-parent $Stellantis NV(STLA.US)$ this week, calling on about 12,000 workers to walk off the job at two highly-profitable plants, one per automaker.
The action at GM's plant in Arlington, Texas, came immediately after the company reported its third-quarter earnings to investors Tuesday. Ford plans to report third-quarter results after market close on Thursday.
GM and Stellantis must separately reach tentative deals with the UAW before their workers return to the factory floor.
Comments