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© Reuters. FILE PHOTO: UAW President Gary Jones shakes hands with Ford Motor Co Chairman Bill Ford at the start of contract talks between the union and the automaker in DetroitBy Ben Klayman and Nick Carey
DETROIT (Reuters) – United Auto Workers leaders from Ford Motor Co’s (N:) U.S. plants on Friday recommended approval of a tentative labor agreement that would allow the No. 2 U.S. automaker to avoid a strike like the one that cost its larger rival General Motors Co (N:) about $3 billion.
The union turned to Ford to negotiate a new four-year agreement after ratifying a contract last week with GM following a 40-day U.S. strike that shut down almost all of that company’s North American operations. Ford and the UAW quickly reached a tentative deal on Wednesday.
The deal now must be ratified by the 55,000 UAW workers at Ford, with voting running through Nov. 15. While GM’s deal was approved, ratification is not a sure thing, as union members at Fiat Chrysler Automobiles NV (MI:) in 2015 rejected the first version of a contract.
Detailed terms of the Ford deal echoed those agreed to with GM, as the union typically uses the first deal as a pattern for those that follow. The UAW said the deal included agreements by Ford to invest more than $6 billion in its U.S. plants, and to create or retain more than 8,500 UAW jobs.
The full-time UAW members at Ford also will receive a signing bonus of $9,000 under the deal, but the deal will allow the Dearborn, Michigan, company to close an engine plant in Romeo, Michigan, the UAW said.
Ford historically has had an easier relationship with the union than its Detroit rivals, with Ford Executive Chairman Bill Ford describing the UAW as “family” in the past.
Under the deal with GM, that automaker agreed to invest $9 billion in the United States, including $7.7 billion directly in its plants, with the rest going to joint ventures. It also said it would create or retain 9,000 UAW jobs. The GM contract also will provide $11,000 signing bonuses to members, and pay raises.
Under its deal, GM also will close three plants, but it left the UAW members’ healthcare insurance coverage unchanged.
Once the Ford deal is ratified, the UAW will turn to Fiat Chrysler to complete its quadrennial talks with the Detroit automakers.
The talks have at times been overshadowed by an ongoing federal corruption probe that has involved several UAW senior leaders and been linked to union President Gary Jones. A UAW spokesman on Friday declined to address the probe, saying the focus is on the agreement with Ford.
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