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Ford offers Unifor wage increases up to 25%

FILE PHOTO: Frankfurt hosts the international Motor Show (IAA)

(Reuters) -Ford Motor has offered Canadian union Unifor wage increases of up to 25% in its tentative agreement, the union said on Saturday.

The agreement provides a 10% wage increase for the first year followed by increases of 2% and 3% through the second and third year and a $10,000 productivity and quality bonus to all employees on the active roll of the company, Unifor said.

The proposals also include an increase in the monthly basic benefit and special allowance in all class codes across defined benefit and hybrid pension plans and investments to help transition from traditional internal combustion engine (ICE) vehicle production to electric vehicle (EV) assembly facilities.

Unifor, which represents about 5,600 Canadian auto workers, on Friday said that its Ford leadership group has voted unanimously to support the tentative agreement.

Ford is also in the midst of contract negotiations in the U.S. with a strike by the United Auto Workers (UAW) union at its at the automaker's Wayne, Michigan assembly plant.

The UAW began strikes on Friday against 38 parts distribution centers across the United States at GM and Stellantis, extending its unprecedented, simultaneous strikes that began with one assembly plant each of the Detroit Three. The additional facilities added about 5,600 workers to the 12,700 already on strike.

The UAW said on Friday that Ford had improved its contract offer, including boosting profit sharing and agreeing to let workers strike over plant closures but said the union still has "serious issues" with Ford and its workers would remain on strike at the automaker's Wayne, Michigan assembly plant.

Unlike UAW, Unifor chose one of the Detroit Three as a "target" to negotiate with first - in this case, Ford - in a pattern bargaining tactic used to set the tone for subsequent deals with other companies.

UAW President Shawn Fain said in a Facebook live event that by targeting distribution centers the strike becomes a nationwide event. He said he expected talks to continue through the weekend.

The standoff is fueling worries about prolonged industrial action that could disrupt production and dent U.S. economic growth. A Reuters/Ipsos poll released on Thursday showed significant support by Americans for the striking auto workers.

U.S. President Joe Biden said in a social media post on X, formerly known as Twitter, that he would come to Michigan on Tuesday "to join the picket line and stand in solidarity with the men and women of UAW," while former President Donald Trump, who is seeking a new term, will be in Michigan on Wednesday to address auto workers, his campaign said.

(Reporting by Gokul Pisharody in Bengaluru; Editing by Daniel Wallis and Alistair Bell)