In yet another sign of how tense and volatile the latest UAW contract negotiations have become, Ford CEO Jim Farley criticized publicly UAW President Shawn Fain, the speed of contract negotiations and what’s holding up a fair contract deal shortly after Ford learned Friday its Chicago Assembly was targeted by the UAW for expanded strike activity.
“What’s really frustrating is that I believe we would’ve reached a compromise on pay and benefits but so far the UAW is holding the deal hostage over battery plants,” Farley said in extended remarks following a Facebook Live in which Fain announced the UAW’s next targets.
“Keep in mind, these battery plants don’t exist yet. They’re mostly joint ventures. They’ve not been organized by the UAW yet because workers haven’t been hired and won’t be for many years to come,” Farley said. “The UAW is scaring our workers by repeating something that is factually not true. None of our workers today are going to lose their jobs due to our battery plants during this contract period or even beyond this contract. In fact, for the foreseeable future, we will have to hire more workers as some workers retire, in order to keep up with the demand of our incredible new vehicles.”
The multibillion-dollar electric vehicle battery plant planned for Marshall could get bigger or smaller, depending on a series of factors including labor costs, Ford said of the project it paused this week.
And the supply base is “on a knife’s edge already,” Farley said. Look at Michigan Assembly, which builds the Bronco, he said. “Suppliers there employ 125,000 hourly workers. In the plant we employ about 5,000. All those 125,000 hourly jobs are at risk as the strike moves on. If the UAW’s goal is a record contract, they’ve already achieved that.”
Farley questioned whether the UAW is simply trying to create “industrial chaos.”
“If we’re going to take on the world, we have to do it together,” Farley said. “Shawn (Fain) has been on the TV more than Jake at State Farm (insurance) at this point. I’ve heard what he wants but I’ve never heard him say once why he believes the UAW can be the competitive advantage to Ford.”
While Ford touted its historic UAW offer Sept. 12, even that earlier proposal has been improved, Farley said. The Ford team declined to offer details though it did mention a 20% wage increase over four years.
‘Name the time and place’
Meanwhile, Fain released a statement in response Friday to Farley’s comments:
“I don’t know why Jim Farley is lying about the state of negotiations,” Fain said. “It could be because he failed to show up for bargaining this week, as he has for most of the past 10 weeks. If he were there, he’d know we gave Ford a comprehensive proposal on Monday and still haven’t heard back. He would also know that we are far apart on core economic proposals like retirement security and post-retirement health care, as well as job security in this EV transition, which Farley himself says is going to cut 40% of our members’ jobs. Like a good neighbor, we’re available 24/7. Name the time and the place you want to settle a fair contract for our members, and we’ll be there.”
Farley made a speech in November 2022 during a Rainbow PUSH Coalition event in Detroit where he was quoted by multiple news outlets saying as many as 40% of current manufacturing jobs could be lost during an EV transition.
Still, news media briefings during contract negotiations is unlike anything anyone remembers. In this case, Farley had by his side a chief financial officer and chief labor negotiator during what is usually a highly sensitive and secretive process. After labor contracts are ratified, these people work hand-in-hand weekly to address factory issues and resolve everyday conflicts.
A bump on the road to mutual success
Ford praised Unifor workers in Canada for ratifying a “great” three-year contract this month that included a 15% wage increase. “They understand this is about mutual success,” Farley said.
Ford’s profit margins are thin, and huge new investments are essential, Farley said.
“We’ve stayed quiet and worked around the clock in an effort to reach a deal but with today’s strike expansion by the UAW, I think it’s time to share some facts and provide an update on the talks,” Farley said. “First, Ford has offered an incredible contract that would change the lives of over 57,000 workers for the better. Second, we believe the UAW is holding up the deal over battery plants that won’t come online for another two to three years. And finally, we still have time to reach an agreement and avert a real disaster but not much more time, given the fragility of the supply base.”
Farley said Ford has been the most supportive of the UAW and manufacturing in America, employing about 40% of the UAW’s Detroit Three membership. It adds about a billion dollars in costs while rivals have moved full-size truck production to Mexico. Only Ford has added 4,400 UAW jobs since the Great Recession, while its local competitors have cut more than 32,000 UAW jobs, he said. And Ford has exceeded contract agreement goals in the last three UAW contracts, Farley said.
“In the fog of all the rhetoric, I think people are missing that Ford has stepped up with a historic offer. Bottom line, someone needs to really tell the truth about what is really going on and what’s at stake here. It might as well be us at Ford,” Farley said.
“The union asked for historic gains for our workers. No problem, we didn’t even wait for the contract for that. Record contract? No problem. Mortgaging our future? That’s a big problem. We will never do it,” Farley said. “The billions in costs the UAW leadership is demanding beyond the billions we have already offered them would have devastating impacts for our business, and therefore, our workforce.”
And the topic of electric vehicles have now become a political football, Farley said. “And that’s a shame.”
He noted that while electric carmaker Tesla is profitable and growing, Ford will continue building electric and gasoline-powered vehicles and allow customers to choose as they do now, Farley said. “I truly believe that what is at stake here is the future of the domestic auto industry, the future of the industrial Midwest and the future of good-paying manufacturing jobs.”
Ford is committed to continue trying to reach an agreement, Farley said. “As this strike shows, we can’t build vehicles in the U.S. without the UAW. Whether Shawn Fain believes it or not, the UAW needs a healthy Ford, General Motors and Stellantis to have a future. It’s going to take compromise. It’s going to take leadership to meet this moment.”
The length of the strike that began Sept. 15 will depend on both parties compromising.
“The battery plant discussion has been very difficult,” Farley said. “We have felt from the very beginning, between all the lines of our comments that the original strike was premeditated and that everything is taking way too long.”