Ford drives hard deal with UAW

Jill Barshay Nov 1, 2007


Scott Jagow: In Detroit, auto workers are still negotiating. They’ve gotten deals from GM and Chrysler, but Ford is holding out. More now from Jill Barshay.

Jill Barshay: Sometimes, it’s best to save the worst for last.

Brett Hoselton is an auto analyst at Keybanc Capital Markets. He says the United Auto Workers always knew Ford would drive the hardest deal. It didn’t want to set a precedent for its other contracts.

Brett Hoselton: The Ford agreement is gonna be much more challenging. Ford is going to want to extract more from the UAW, more cost cuts and so forth from the UAW, but is going to be willing to give up less.

Hoselton says five years ago, Ford used to sell a quarter of the cars in the U.S. Today, its market share is less than 16 percent.

Hoselton: Ford’s new business plan is to sell fewer cars. However, they’re gonna sell those fewer cars at a greater profit. So they’re gonna downsize their organization. Obviously, you’re gonna have to cut more heads.

Ford wants to close 16 factories, and lay-off as many as 10,000 more workers. Hoselton says talks will probably go on for another week.

I’m Jill Barshay for Marketplace.

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