Ford is arguably the domestic maker in the most trouble, and it appears the UAW has allowed more concessions for Ford than for either of the other two domestic car car makers in its contract negotiations. With combined savings from the end of health care obligations, revised rules on hiring, salaries, and classifications, Ford will be able to put $2 billion more in its coffers every year.
The largest lump came from Ford -- as with GM and Chrysler -- earning a release from its health care obligations by contributing to a VEBA. Ford's contribution of $13.6 billion will rid itself of the $23.7 billion health care shadow it stood in. That is less than the other two of the Big Three contributed, and once approved will save Ford $1 billion per year.

The other savings come from the UAW's flexibility in allowing Ford to make more than 20-percent of its workforce lower-paid hourly workers, who get up to $50 less per hour than other UAW workers. The UAW is also doing things like reclassifying skilled trades categories, reducing them from 350 to 22. In return, Ford has stepped back from plans to idle some plants, is bringing some outsourced jobs back in-house, and is making plants more flexible so that they can build different cars more easily, instead of being shut down.

In a related article, Automotive News (Sub. Req.) is reporting that the extra cash will be used to revamp Ford's North American product line in the next few years, including the accelerated development of several new models.

[Source: Detroit News, Automotive News]


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