DETROIT – Local United Auto Workers union leaders approved a tentative agreement Sunday with Ford Motor that includes $8.1 billion in new plant investments by the company, $5,000 ratification bonuses and other economic gains such as 25% compounded wage increases and improved profit-sharing payments.
The 4 ½-year tentative agreement, which was announced Wednesday, will now be rolled out to 57,000 UAW-Ford members for regional informational meetings and then voting, the union said Sunday. The UAW did not release an expectation for when voting, which typically takes a couple weeks, will conclude.
“We send this contract to you because we know it breaks records. We know it will change lives. But what happens next is up to you all,” UAW President Shawn Fain and UAW Vice President Chuck Browning said in a joint statement included in a summary of the deal.
UAW leaders outlined some details of the tentative agreement last week but released the summary and more than 800-page contract Sunday after local union leaders approved it for member voting.
The tentative agreement was reached after the union launched targeted strikes against Ford, General Motors and Chrysler-parent Stellantis when the sides could not reach deals ahead of a Sept. 14 deadline.
The UAW announced a tentative deal Saturday with Stellantis, however, it has yet to reach a new agreement with GM, despite the sides being close to a deal last week.
The largest promised investments under the deal include $2.1 billion for Ohio Assembly for current products and a new electric van; $1.2 billion for a new EV at Louisville Assembly in Kentucky for pickup and SUV production, including hybrid versions of the Ford Expedition and Lincoln Navigator; $1 billion in Kansas City Assembly; and $900 million for F-150 production and a new electric truck.
The 25% raises includes an 11% increase upon ratification, followed by 3% increases the next three years and then a 5% increase in October 2027. The raises and benefits such as expectations of $8,800 for cost-of-living adjustments cumulatively raise the top wage to more than $40 an hour, including an increase of 68% for starting wages to over $28 an hour.
Fain said Sunday the UAW plans to use this record deal, as well as others with different companies, as a way to assist its embattled organizing efforts, including auto companies outside of the “Big Three” Detroit automakers.
“One of our biggest goals coming out of this historic contract victory is to organize like we’ve never organized before,” Fain said Sunday during an online broadcast. “When we return to the bargaining table in 2028, it won’t just be with the ‘Big Three,’ but with the big five or big six.”
UAW said it also secured jobs and easier organizing rights at upcoming battery plants and electric vehicle assembly plants, including a battery plant being constructed by the automaker in Michigan.
A major change in the deal is its length from four years to four and a half years, with the contract set to expire in April 30, 2028. Fain said the decision to change the length was to align the deadline with May Day, also called Workers’ Day or International Workers’ Day, on May 1.
Fain urged other unions to align their deadlines to that time period as well.
Other new benefits for members under the deal include a three-year progression to top pay rates; immediate conversion of temporary workers to permanent positions after three months; enhanced profit-sharing; two weeks of paternity leave; and increased 401(k) contributions, including 10% company contribution that would equal about $11,000 per year for workers making top pay.
While the deal is a record, it did fall short of some of the UAW’s initial goals including 40% pay increase during the terms of a deal, a 32-hour workweek, traditional pensions for all workers and other benefits for retirees.