Oct 12, 2023 - Economy

Ford executive: "We have reached our limit" on UAW strike offer

Workers holding picket signs at night

Factory workers and UAW union members form a picket line outside the Ford Kentucky truck plant in the early morning hours Thursday in Louisville after the union announced it would expand its ongoing strike to include the facility. Photo: Luke Sharrett/Getty Images

Ford executives said Thursday that they're not prepared to offer more economic value to the United Auto Workers union in contract talks.

Why it matters: About four weeks into the strike, the UAW on Wednesday shut down another Ford facility — this time the company's sprawling Kentucky truck factory, which reaps more revenue than Southwest Airlines.

Driving the news: "On the economics, I would say, yes, we have reached our limit," Kumar Galhotra, president of the Ford Blue division, said Thursday afternoon on a conference call. "We've actually stretched ourselves to get to this point."

  • Ford executives said they were shocked when the UAW on Wednesday walked out of talks on pension issues and collective bargaining rights associated with the company's battery plants.

By the numbers: The Ford plant in Kentucky makes the Ford F-series Super Duty pickup, a crucial profit engine for the automaker, as well as the Ford Expedition and the Lincoln Navigator SUV.

  • The Kentucky plant has more than 8,700 UAW workers — and more than 600 suppliers provide parts to the factory.
  • With the plant's shutdown, "the fragile supply chain will be nudged further toward collapse," Ford chief supply chain officer Liz Door said Thursday.

Worth noting: Galhotra said Ford is "open to moving some money around within the deal that might fit the union's needs better, but broadly speaking from an overall cost-of-the-deal perspective, yes we're there."

  • The company said it had offered pay increases of more than 20% to permanent workers, raises of 26% for temporary workers, the return of cost-of-living adjustments, a ratification bonus, increased 401(k) contributions, additional paid time off and "no job loss due to EV battery plants," among other things.

The other side: The UAW had no immediate comment Thursday, but union President Shawn Fain has repeatedly called on the automakers to deliver "record contracts" after earning "record profits."

  • "We have been crystal clear, and we have waited long enough, but Ford has not gotten the message," Fain said Wednesday in a statement after expanding the strike to Kentucky.
  • "It's time for a fair contract at Ford and the rest of the Big Three. If they can't understand that after four weeks, the 8,700 workers shutting down this extremely profitable plant will help them understand it."
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