Ford UAW negotiations press-kit

[wescoent]

We're going to pass them anyway and already have in some segments, Have you been reading the independent studies on our quality? I don't agree with going to third party reporting agencies in order to pacify their tastes, what of the customers opinions. If they want an accurate accounting of what people want there are customers on forums like this everyday telling Ford what they want. As far as being over payed, the pension liability is their disadvantage and I foresee the implementation of 401K's coming in luo of traditional pensions. That will stop future bleeding and eliminate the compensation gap between us and our competitors. As for the past pension obligation that's theirs to choke on, If they had never obligated their selves then they wouldn't have to consider taking away from employees that are too old or no longer physically capable of working. I personally will vote to strike if they try to harm our retirees. If there be wage concessions they must be gradual by a % per year over the life of the contract, otherwise they run the risk of putting their employee's through bankruptcy. If it's us or them than it can be both!

 

The plot thickens... threats of a strike!

 

If Ford decides to cut retiree benefits, the UAW will strike. Positive cash flow stops, Ford goes bankrupt. Private equity takes over, moves production to non-UAW plants, and the UAW is cut out of Ford forever.

 

I have seen the quality surveys, and Ford is indeed among the best in some segments, as we rapidly approach a quality plateau, where you really can't make the vehicles higher quality or more reliable without incurring enormous costs to achieve miniscule gains.

 

Ford already pays attention to customer desires, but they need to also talk to the third parties. If it just means some meetings, and some stupid improvements that are cheap and easy, and it means at least a few new people will buy Fords, then why not? Having more voices at the table means a higher liklihood of correcting small mistakes.

 

Well, if 401ks are implemented, it will be the UAW that needs to do if they take over benefits administration.

[Furious1Auto]

Any politician who tried to ban the import of Japanese cars and parts would be summarily executed by the car buying public.

 

Would you also ban foreign competition from selling oil in the US? Talk about a beneficial move! ^.^

If we converted to E85 we would not have a dependency, Globolization has to do with one thing corporate profits. "If we can't get the price we demand in our current market than we need to open up new markets". When companies where trapped here then they where fair and competitive. Now their just moving work out of the country to cheaper labor markets!

Look how many jobs have been lost in this country due to NAFTA, CAFTA, and a favorable trade status whit China and Japan.

Edited July 9, 2007 by Furious1Auto

[Alexander Drummond]

Actually, overall employment has increased since the 1980's.

[Furious1Auto]

The plot thickens... threats of a strike!

 

If Ford decides to cut retiree benefits, the UAW will strike. Positive cash flow stops, Ford goes bankrupt. Private equity takes over, moves production to non-UAW plants, and the UAW is cut out of Ford forever.

 

I have seen the quality surveys, and Ford is indeed among the best in some segments, as we rapidly approach a quality plateau, where you really can't make the vehicles higher quality or more reliable without incurring enormous costs to achieve miniscule gains.

 

Ford already pays attention to customer desires, but they need to also talk to the third parties. If it just means some meetings, and some stupid improvements that are cheap and easy, and it means at least a few new people will buy Fords, then why not? Having more voices at the table means a higher liklihood of correcting small mistakes.

 

Well, if 401ks are implemented, it will be the UAW that needs to do if they take over benefits administration.

You haven't read a threat from me, So, Ford files bankruptcy and cuts it's obligations. Then they will owe 70% less to their associates. If we have to file why shouldn't they. Lastly I'd like to see an equity firm launch a product let alone all of the U.S. products at once with a bunch of inexperienced TFT's. How much would they endure, good luck finding a buyer! Crystler was able to because they showed a profit for the three preceding years. We have a legal right to strike for unfair labor practices and can't legally be fired for exercising our rights. It is better that we work together to find a fair and equitable solution!

[Alexander Drummond]

Unfair labour practices? And how much more does the average auto worker earn, let alone cost, than the median income in the U.S.? This is far from the same thing as the gilded age, where workers where not paid enough for simple necessities.

 

So complain about benefits, and fight for your rights. But don't you dare say that you have things bad, because that is a fallacy of logic. One only needs to look back into history and to other countries to see that is utter bunk.

Edited July 9, 2007 by Alexander Drummond

[Furious1Auto]

Actually, overall employment has increased since the 1980's.

Uh actually the drop in unemployment as reported by the government is based on the number of people drawing unemployment, unemployment benefits only last 6 months! Also what jobs have been created are low paying for blue collar workers and the rest have taken concessions. Ask the steel workers, not to mention the inflation. So now Americans work more hours and their standard of living is dropping!

[Alexander Drummond]

Pioneer, those costs were passed onto you by previous workers. Although it is Ford's fault, it is still the cost per worker. Worker's benefits, worker's costs.

 

Furious, tell that to the burgeoning medical and tech industries. I was looking at total number of jobs, not unemployment. Although unemployment is at a decent rate as well.

[Furious1Auto]

Unfair labour practices? And how much more do you earn, let alone cost, than the median income in the U.S.?

 

This is far from the same thing as the gilded age, where workers where not paid enough for simple necessities.

Who's asking for increase we're just trying to limit concessions. Like I pointed out, most people's bills are set by their current income. I'm not even saying that concessions aren't in order, but they need to be gradual! The only reason people work at Ford is for the pay and benefits if you take it away it's not worth it for me at least. I made good money before I came to Ford and my income wasn't based on car sales! That's why I'm not afraid to stand and fight!

Edited July 9, 2007 by Furious1Auto

[Alexander Drummond]

I work at a job where I am required to work in intense heat and carry extremely heavy loads.

 

I earn less than $10 USD per day; granted, this is not my long term job. However, it is much lower than people doing a similar intensity work.

 

Just an idea of how it -could- be. :] I hope these negotiations come to an amicable agreement.

 

Pioneer: I don't think it -is- right, which is why I hope the UAW and Ford work something out at these negotiations. Those prices are ridiculous.

Edited July 9, 2007 by Alexander Drummond

[Furious1Auto]

Pioneer, those costs were passed onto you by previous workers. Although it is Ford's fault, it is still the cost per worker. Worker's benefits, worker's costs.

 

Furious, tell that to the burgeoning medical and tech industries. I was looking at total number of jobs, not unemployment. Although unemployment is at a decent rate as well.

With all manufacturing leaving the country, and less and less workers receiving medical benefits their next. Right now as we speak our local hospitals are beginning to advertise ton T.V. to compete for a hand full of people who still have medical! Lorain community Hospital just put an article in the paper that they where laying off! You need to read the thread in this forum titled National healthcare!

[Alexander Drummond]

My family is all in the health-care business. Nationally, it is doing fine; it is the patient-insurance system that is having issues.

 

Manufacturing may continue to leave; we have to adapt and promote/increase our relative advantages. That's how it goes.

[Furious1Auto]

I work at a job where I am required to work in intense heat and carry extremely heavy loads.

 

I earn less than $10 USD per day; granted, this is not my long term job. However, it is much lower than people doing a similar intensity work.

 

Just an idea of how it -could- be. :] I hope these negotiations come to an amicable agreement.

 

Pioneer: I don't think it -is- right, which is why I hope the UAW and Ford work something out at these negotiations. Those prices are ridiculous.

You know what you shouldn't hate us for doing well, because I have empathy for those who don't. I think working in the conditions that you do you may be getting under compensated but rather than put your angst on me, you need to be looking at your employer. Without a union wages are much lower, although there are problem within the union it is the only thing that assures a steady pay. I've been non-union too and it sucks!

[Alexander Drummond]

Yup, and that person flies on an American-owned airplane, most likely built here in America by Boeing, which is... *drumroll please* a manufacturing job.

 

Things are connected, and often to our favor. As I said, if we concentrate on our strengths, we'll be in a dandy position indeed.

 

Furious: I'm not upset or enviable. I chose this job because I could make my own schedule. I was just saying: Things are not as bad as they could be in the auto industry. I'm not rooting against the workers; if you'll read my other posts, I want the negotiations to succeed. But the American worker needs to be dedicated to being the best worker in the world for it to succeed.

Edited July 9, 2007 by Alexander Drummond

[Furious1Auto]

My family is all in the health-care business. Nationally, it is doing fine; it is the patient-insurance system that is having issues.

 

Manufacturing may continue to leave; we have to adapt and promote/increase our relative advantages. That's how it goes.

Yeh, and what do they do about it they raise the premiums to where people can't afford it, well geuss what Ford can't even afford it anymore. It's a bubble and it's about to burst!

[Furious1Auto]

Yup, and that person flies on an American-owned airplane, most likely built here in America by Boeing, which is... *drumroll please* a manufacturing job.

 

Things are connected, and often to our favor. As I said, if we concentrate on our strengths, we'll be in a dandy position indeed.

Not if we have to compete with illegals and cheap labor markets, the only ones making money are the big business's! My forefathers didn't settle this country for me to be an economic slave to a handful of wealthy people!

Edited July 9, 2007 by Furious1Auto

[silvrsvt]

I'll point this out one more time for the cheap seats.

 

*I* do not cost Ford $70 per hour. *I* cost Ford around $45 per hour. The rest is for the current retirees.

 

Why is that so hard for some people to understand? :shrug:

 

 

See thats the problem...its all about you...your part of the organization that has issues, thus part of the "problem" even though you aren't the direct cause. Its like paying taxes, you can't pick where your taxes are going if you don't support the War in Iraq, paying for Illegals and so forth..

 

You can't go around saying Oh I only cost $45 dollars and hour to employ, when you are part of what 80K workers or what ever the number of Ford employees there are?

[xr7g428]

There are two statements that are repeated over and over on this board that are factually incorrect:

 

"The pensions were not fully funded by Ford."

 

The amount of money that the company can expense as a contribution to the pension fund is established by the IRS every year. Ford has always acted in accordance with the law. The deficit in the pension is caused by rising costs for medical care, increased life spans, and investment shortfalls of the pension contributions. If investment returns improve, there can easily be surplus in the pension accounts.

 

There is a current limit of $15,500 per year for 401K (also TESPHE). If you determine later that that was an inadequate amount of savings, then who underfunded it?

 

There was no elective choice between funding the pension and using the money for something else. Saying that Ford underfunded the pension is like saying that we underfunded our social security accounts by not paying in more money that the government asked for.

 

"The cost of retirement benefits is not a part of employee cost. (I cost $45, the rest is retirement benefits...)"

 

Here is what the PDF actually says:

 

Hourly Labor Cost

Here is how they get to $70.

 

Labor costs can be defined and measured in a number of ways. One of the most meaningful measures is the total

average hourly cost to the company per hour worked. This includes: (1) all the dollars paid to employees, (2) the cost of

contractual benefits for employees, and (3) the cost of statutory payments, such as Social Security and Workers'

Compensation – all calculated on the basis of hours worked by employees.

Ford's total average hourly cost per hour worked $70.51.

 

One element of total average hourly cost is the gross average hourly earnings (GAHE). This is essentially what

shows up in the paycheck. It includes base wages, cost-of-living allowance and premium payments.

Another element, the benefits and fringe cost, includes the cost of all insurance benefit coverage, supplemental

unemployment plan costs, paid time off, statutory payments, profit sharing, Guaranteed Employment Number (GEN) and

all other miscellaneous payments and costs.

Ford's GAHE rose from $22.95 in 1997 to $32.38 in 2006

 

For every worker that Ford hires, there come a number of compensation "buckets" that have to be filled.

 

The first bucket is the hourly wage, then the FICA bucket and the employer portion of Social security bucket, and then health insurance bucket and so on. The reason that the $70.51 seems so high is that the number of buckets is so great.

 

Read the PDF and you can count probably a 100 different buckets. Every dollar spent on any of these programs adds to the total that must be divided by the number of employees. Here are just a few: SUB benefits, GIS benefits, GEN benefits, Legal Services benefits, Employee training ans assistance plan ETAP, Scholarship for Dependent Children ($1500 year),Employee Assistance Plan, and on and on...

 

There are some very big buckets that no one seems to want to touch. Absenteeism, Restrictive work rules, plant closing rules, and many other UAW negotiated "benefits" also add to the total cost of employment at Ford.

 

I genuinely believe that it the rank and file had a big menu that said, okay here is $50 per hour, pick how you want to spend it, that there would be a lot less of these buckets. Toyota pays more per hour, but has a lot fewer "soft" buckets to fill.

[Alexander Drummond]

Thank you. I was hoping that someone else would cover statutory and past/present contractual payments. ;]

 

Any words yet on what either side is proposing?

[Alexander Drummond]

Because you're right, and economists are wrong?

[silvrsvt]

So, by your logic, that means everybody that is now currently working should count as drawing social security?

 

Whats the number of workers who are not drawing social security and those who arent?

 

Numbers from the same PDF for pay...your pension goes down when you can draw SS

 

Pension Benefits

For the purpose of reviewing pension benefits, the hourly employees for this example are 60 years of age, with 30

years of creditable service, and have elected early retirement. They would be paid the following pension benefits

monthly.

· At Retirement (age 60)

· At age 623

· At age 65 (enrolled in Medicare)3

Major Assembler

(Ben. Class Code B)

$3,020.00

$1,534.50

$1,610.70

Tool & Die Maker

(Ben. Class Code D)

$3,020.00

$1,549.50

$1,625.70

 

When did congress vote to go to war?

 

(You don't want to start another argument you are going to lose, do you?)

 

When are you going to stop grasping at straws? No matter what, weather or not if they did or didn't, you and I are still paying for it.

[Furious1Auto]

"It could happen to you"

Heed the prophetic words of Ed McMahon. A 2005 study conducted by Standard & Poor's listed 20 U.S. companies with massively underfunded pension obligations. At the top of the list — as will surprise no one who reads a newspaper from time to time — are the nation's two leading automakers: Ford (NYSE: F), occupying the top slot, and General Motors (NYSE: GM), at No. 3. As of June 2005, the two firms' unfunded pension liabilities totaled a staggering $20 billion

It seems funny to me that Ford was holding exactly $20 bln. in cash before they mortgaged the company, and also their pension fund was short the same amount!

[xr7g428]

Pioneer, this is your livelihood. I am sorry that things are going to crap in the car business. I don't have a dog in this fight anymore, but I would like to see this great old company that invented mass production, and maybe the middle class, survive.

 

My only point is that the UAW has been able to extract a whole bunch of benefits and policies that are so expensive that not even the members can believe they exist. Most likely, you personally don't cost Ford $70. The sad part is there are a bunch of "workers" that are costing Ford twice that. Put a different way, you are probably carrying your weight, and the weight of several others.

 

What does a 401k have to do with a defined pension?

 

The amount of money that can be set aside in each is established by the Federal government. There is a cap. The money paid in to your pension fund is an expense to Ford. Expenses reduce profits. Reduced profits result in reduced taxes. The government puts a limit on how much can be expensed.

 

The same type of cap exists on a 401k, or TESHPE. If it turns out that $15,500 is not adequate then you can consider your self guilty of underfunding your own pension.

 

 

What makes the liability "underfunded" is that the retirees are living longer than expected, the cost of the health care benefit is rising faster than expected, and the returns from the investment of the pension fund money is not growing as fast as hoped.

 

If you promise your daughter a shiny new car when she graduates from college, and cars go up in price faster than you expected, and you can't save enough, you still owe her the car, but you are "underfunded". Ford made you guys a promise. The promise is underfunded when it costs more to fill it than they have in the bank.

 

Stop trying to paint yourself as the victim. Ford did not piss away your pension money on bad investments. Every one is in the same boat as far as the economics of longevity and retirement.

 

Now, has something magically happened since 2005?

 

Actually, the market has done pretty well so far this year, and that has gone a long way towards fixing the "underfunded" pension liability. If it were not for the market crash following 9/11, there might never of been any issue. Along those lines, if Ford and GM hadn't gone to x plan pricing for every body, and destroyed the market, there might really not be an issue...

[Automotive Paint]

Stupid question:

 

If Ford filed bankruptcy and restructured would that break their contract with the employees/UAW or is that up to the judge?

[Furious1Auto]

Stupid question:

 

If Ford filed bankruptcy and restructured would that break their contract with the employees/UAW or is that up to the judge?

It's up to a judge and as of yet, no judge has ever nullified a union contract for active workers. My guess is that they know it will be their end. They know that the general public doesn't even give a shit and won't vote. On the other every union in their state will advise it's members to vote against them. It's political suicide!

[Furious1Auto]

Ford would have to petition the judge to break the contracts, and give reasons as to why. Wouldn't be tough to do, but the work stoppages would be a bitch.

Yeh, and that's the other consequence! Put them together and no one has a good time!