U.S. Markets open in 7 hrs 38 mins

Ford-UAW contract passage in doubt as voting nears end

Jimmy Settles, UAW vice president of the National Ford Department, speaks at a news conference in the United States, at the assembly plant in Flat Rock, Michigan August 29, 2013. REUTERS/James Fassinger

By Bernie Woodall

DETROIT (Reuters) - Leaders of the United Auto Workers union scrambled Wednesday to salvage a proposed labor agreement with Ford Motor Co (F.N), warning rank-and-file members that a rejection of the deal could jeopardize investments that would sustain U.S. factory jobs.

With three-fourths of the national Ford union voted counted, 52 percent have rejected the proposed contract, Jimmy Settles, head of the UAW's Ford Department, said at UAW Local 600 in Dearborn, Michigan.

He and other UAW officials appealed to Ford workers still to vote to support the deal or risk losing some of the $9 billion in investments in U.S. factories that Ford has promised in the agreement.

"I seriously think that if we don’t ratify it, that (investment) would be in jeopardy,” Settles said. “And that’s job security. If they invest in plants, they don’t close plants.”

Voting extends through Friday night, including at Local 600, which has 8,500 of Ford's nearly 53,000 UAW members.

Final results will not be known until at least Friday night, with a UAW announcement due on Saturday, Settles said. The UAW needs a majority of votes for the contract to be ratified.

UAW leaders have clashed with the rank and file at all of the Detroit Big Three automakers.

A proposed four-year national contract for hourly workers at the U.S. operations of General Motors Co (GM.N) is in doubt because skilled trades workers have voted against it. UAW leaders are working with GM management to resolve the concerns of skilled trades workers, who repair factory equipment.

UAW President Dennis Williams needed two tries to win ratification of a four-year contract for hourly workers in the U.S. operations of Fiat Chrysler Automobiles NV (FCHA.MI)(FCAU.N).

After the first Fiat Chrysler contract was rejected, union leaders renegotiated a deal that put more money in members' paychecks, including a larger bonus for ratifying the agreement.


"WE GAVE UP THE FARM"

UAW leaders say the proposed agreement with Ford is the richest in history. But that hasn't stopped the rank and file from using social media to challenge them, saying the deal does not do enough to make up for pay and benefits that were sacrificed when Ford struggled to restructure during the last recession.

The automaker has enjoyed robust profits this year as sales of trucks and sport utility vehicles made in UAW factories have boomed.

UAW leaders are concerned they no longer have the leverage to demand higher wages, now that vehicles made in UAW factories account for less than one-half of U.S. auto sales.

“We were the reason that Ford stayed out of bankruptcy, and people did give up a lot,” said Bernie Ricke, president of Local 600. But Ricke said remaining competitive requires a "delicate balance," especially with the threat that automakers could shift jobs to Mexico.

"If you don’t have the investment, it doesn’t matter what you negotiate in wages," said Ricke.

Scott Houldieson, vice president of Local 551 in Chicago, where workers voted Wednesday, said members who were rejecting the contract believed it did not make up for the sacrifices that helped save Ford.

"We basically gave up the farm," said Houldieson, pointing to a pay hike they gave up in 2006 and a cost-of-living raise not taken in 2009.

Kristin Dziczek, labor analyst at the Center for Automotive Research, said Ford is not likely to spend more money on a richer contract overall if the two sides return to the bargaining table.

Ford shares rose 1.7 percent to $14.40.


(Editing by Jeffrey Benkoe)