Ford and UAW Avert Strike with Tentative Agreement on 25% Raises

Ford and the United Auto Workers (UAW) union have reached a tentative agreement that would end a 41-day strike that affected the automaker’s U.S. operations. The agreement, which still needs to be ratified by the union’s 57,000 members, would give workers immediate 11% raises and a total of 25% raises over the next four years. The agreement would also address other issues such as safety, health care, and job security. Here are the details of the agreement and its implications for the industry.

The Terms of the Agreement

The tentative agreement between Ford and the UAW was announced on October 25, just two days before the deadline set by the union to launch a strike at the Kentucky Truck Plant, one of Ford’s largest and most profitable factories. The agreement would cover all of Ford’s U.S. hourly workers, who have been working without a contract since April 2021.


According to the UAW, the agreement would provide workers with the following benefits:

  • Immediate 11% raises upon ratification, followed by 3.5% raises in 2025, 2026, and 2027, and a 3% raise in 2028, for a total of 25% raises over the next four years.
  • A reinstatement of cost-of-living adjustments (COLA), which were suspended in 2019, to help workers cope with inflation.
  • A three-year path to top wages for workers who were hired after 2007 and were on a lower pay scale. The top wage would increase from $32.32 an hour to over $40 an hour by 2028.
  • A $8,500 signing bonus for each worker upon ratification, plus annual performance bonuses and profit-sharing payments.
  • Improved health care benefits, with no increase in premiums or co-pays, and a new dental plan.
  • Enhanced job security and seniority provisions, with a commitment from Ford to invest $9 billion in its U.S. plants and create 11,000 new jobs over the next four years.
  • Increased retirement benefits, with a $1,000 increase in the monthly pension for current retirees and a $2,000 increase for future retirees.

The UAW said that the agreement would deliver more value to workers than the previous contract, which was signed in 2019 and expired in April 2021. The union also said that the agreement would reflect the workers’ contribution to Ford’s record profits in 2023, which amounted to $9.4 billion in the first half of the year.

The Impact of the Agreement

The tentative agreement between Ford and the UAW would end the longest and largest strike in the U.S. auto industry since 2019, when the UAW staged a six-week strike against General Motors, affecting 46,000 workers. The strike at Ford, which began on September 15, affected 57,000 workers and disrupted the production and delivery of several models, including the F-150 pickup, the Mustang, and the Bronco.

The agreement would also set a new benchmark for the U.S. auto industry, as it would raise the wages and benefits of workers to unprecedented levels. The agreement would also put pressure on other automakers, such as Toyota, Honda, and Hyundai, which have non-unionized plants in the U.S., to match or exceed the standards set by Ford and the UAW.

The agreement would also have implications for the future of the U.S. auto industry, as it would support the transition to electric vehicles, which are expected to dominate the market in the coming years. The agreement would include a commitment from Ford to invest in electric vehicle production and technology, and to offer incentives and training for workers to switch to electric vehicle jobs.

The agreement would also have a positive impact on the U.S. economy, as it would boost the income and spending of workers, and create more jobs and investment in the manufacturing sector. The agreement would also align with the Biden administration’s agenda, which aims to promote and support the U.S. auto industry, especially the electric vehicle segment, as part of its infrastructure and climate plans.

The tentative agreement between Ford and the UAW is a historic and significant achievement, that would benefit both the workers and the company, as well as the industry and the economy. The agreement still needs to be ratified by the union’s members, who will vote on it from October 28 to October 31. If approved, the agreement will take effect immediately and run until April 2028.

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