Ford vehicle sales outlook:
'Worst is over'

Bryce G. Hoffman / The Detroit News
Nov 15, 2009

Ford Motor Co.'s top sales analyst said this November U.S. sales appear to be at least as strong as October, meaning the industry has once again found its footing after one of the worst declines in history.

"So far, so good. We won't fall backwards from October," said George Pipas, head of sales analysis and forecasting at Ford. "The worst is over -- both from an economic standpoint and from an automotive standpoint."

However, he warned that the recovery remains fragile, largely because too many Americans remain out of work.

"(Unemployment) is a drag on consumer psychology," Pipas said. "The recession may be over and the recovery may have begun, but for many, many consumers it may not feel like it's over even 12 months from now."

As a result, Ford is projecting only modest sales gains in 2010.

Speaking Friday at the Automotive Press Association, Pipas said the industry that emerges from this downturn will be changed dramatically, with more consumers opting for smaller cars and crossovers. He said these vehicles will represent the largest market segment in the United States by 2013.

That is partly due to concerns about fuel prices, which Pipas said will remain volatile. He predicted that gasoline will hit $4 a gallon again -- probably next summer.

Analyst Jim Hall of 2953 Analytics LLP in Birmingham said that is convenient, considering that Ford has shifted its entire product strategy in that direction. But he believes new, fuel-saving technologies will keep American motorists in larger vehicles.

"Some of the best of these (technologies) are too expensive to put into small cars," Hall said, adding that innovations like advanced six-speed transmissions and smaller turbocharged engines should allow automakers to meet tougher federal emissions requirements with larger vehicles, too.

"There's no penalty for big in this country."

But Pipas said the shift to smaller vehicles is about more than fuel prices.

He said it reflects changing demographics and a new, less-ostentatious aesthetic.

"Consumers in the future will be more careful about living within their means," he said.

Ford fast-tracks new cop car to replace Crown Vic

Bryce G. Hoffman / The Detroit News
November 14, 2009

Ford Motor Co. today confirmed that it is developing a new police interceptor to replace the Ford Crown Victoria when production of that model ends in 2011.

As The Detroit News first reported in August, the Dearborn automaker has decided to abandon the elderly Crown Vic platform in favor of an all-new police sedan, which will most likely be built off the new Ford Taurus platform.

"We have heard the repeated requests from the law enforcement community to continue uninterrupted support of the law enforcement community," said Ford Americas President Mark Fields. "Ford is answering the call with the new Police Interceptor -- engineered and built in America."

Ford said the new vehicle -- dubbed the Ford Police Interceptor -- will offer greater durability, better safety, stronger performance and greater fuel-efficiency than the venerable Crown Vic, which is the leader in the law enforcement segment, accounting for 75 percent of the police pursuit business in the United States today.

The new Police Interceptor is being developed with input from Ford's Police Advisory Board, which includes representatives from major police departments around the country.

"Ford's commitment to the law enforcement community produced the Crown Victoria, the benchmark police vehicle," said Lt. Brian Moran, fleet manager for the Los Angeles County Sheriff's Department and a member of the advisory board. "This commitment has continued, and Ford has been working closely with the Police Advisory Board on developing the new Police Interceptor. I am confident that the next-generation Ford police vehicle will meet the future needs of the law enforcement community and will set the new standard."

Ford said it will unveil the new model in the first quarter of 2010 to give law enforcement agencies time to develop transition plans and outfitters time to develop aftermarket equipment for the vehicle.

"Ford long has supported our public servants with vehicles that work as hard as they do," said Ken Czubay, head of marketing, sales and service in the United States. "We intend to build on this legacy with a new generation of municipal and police vehicles that set even higher standards."

Ford Fusion has record year

Bryce G. Hoffman / The Detroit News
Nov 13, 2009

Sales of the Ford Fusion have topped 151,000 units this year, making it the best-selling car from a domestic manufacturer.

Ford Motor Co. today said its popular midsized sedan already has set a new annual sales record -- pasting its previous high of 149,552 units set in 2007.

"It's extraordinary that a car could set a sales record in an environment where overall industry sales are down 26 percent from a year ago," said Ford sales analyst George Pipas.

In the first 10 months of this year, Fusion sales were 15 percent higher than they were during the same period in 2008, making it one of the top 10 best-selling vehicles in the country.

Fusion sales received a big boost from the new Fusion Hybrid, which now accounts for nearly 20 percent of all Fusion retail sales. And Ford said more than 60 percent of those buying the hybrid model are converts from other brands -- primarily Toyota and Honda.

It also has been helped by stellar ratings from influential publications like Consumer Reports, which says its quality is now superior to competing models from Japan's leading carmakers.

The Fusion was introduced in 2005 as a 2006 model. It is produced in Hermosillo, Mexico.

Kansas Ford plant voting
on strike over workload

Bryce G. Hoffman / The Detroit News
Nov 13, 2009

Workers at Ford Motor Co.'s Kansas City Assembly Plant in Claycomo, Mo., are holding a strike authorization vote today after a disagreement over workloads, but no work stoppage is expected.

The dispute began during the company's annual "rebalancing" talks with the union, which are aimed at increasing the plant's efficiency.

According to people familiar with the situation, the United Auto Workers feels that some of the proposed changes would give some workers too many tasks to perform. A strike vote is typically taken in such cases as a way of increasing pressure on the company, though these rarely result in actual work stoppages.

However, the situation at the Kansas City plant, which produces the Ford F-150 and Escape, the Mercury Mariner and the Mazda Tribute, remains volatile after 92 percent of UAW members there rejected a recent agreement on concessions between the union and Ford.

Ford spokeswoman Marcey Evans said senior managers are at the plant, negotiating directly with local leaders and leaders of the UAW's national Ford section.

"We are working together with the union to address their concerns," she said. "We have a contractual process that we follow to address such issues, and this is part of that process."

While several strike votes have been taken nationwide, Evans noted that none have resulted in a work stoppage at any Ford plant in the past 20 years.

Ford confirms plant
closing as GM invests

GREG KEENAN

From Tuesday's Globe and Mail Published on Tuesday, Nov. 10, 2009

Ford Motor Co. has made it official, confirming that it will shut its St. Thomas Assembly Plant in Southwestern Ontario in the third quarter of 2011.

A letter making the closing official was distributed to the 1,500 employees yesterday, the same day that General Motors of Canada Ltd. was announcing that its Cami Automotive Inc. operation in Ingersoll, Ont., about 45 minutes east of the Ford plant, is receiving a $90-million upgrade to increase production capacity.

The good news-bad news scenario for the Ontario-based auto industry and two plants contrasts sharply with the recent history of the two companies. That history includes a trip through Chapter 11 bankruptcy protection for General Motors Co. and a surprise third-quarter profit at Ford, which stayed out of bankruptcy protection and did not receive a government bailout.

Nonetheless, "unprecedented economic conditions and market forces have required the company to aggressively restructure our business and to consolidate our capacity in order to position the company for future success," Jim Tetreault, Ford's vice-president of North American manufacturing, said in a letter distributed to employees yesterday. "The vehicles manufactured at the St. Thomas Assembly Plant will no longer be required in our product portfolio and no incremental product could be identified to be manufactured at the facility," Mr. Tetreault said.

Those vehicles are the Ford Crown Victoria, Mercury Grand Marquis and Lincoln Town Car full-sized sedans, pushed off in recent years mainly to fleet customers such taxi companies and police forces.

But the gas guzzlers are pariahs now among governments, which are forcing the fleet owners they regulate and own to purchase more environmentally friendly vehicles.

Canadian Auto Workers president Ken Lewenza said although Ford made it clear during recent contract talks that the plant is closing, "this is very tough news."

Mr. Lewenza praised GM and the federal and provincial governments, however, for the GM investment, which will bring 150 Cami workers back from layoff and lead to increased production of Chevrolet Equinox and GMC Terrain compact crossover utility vehicles.

Retooling one of two body shops at Cami will enable the plant to increase production by about 40,000 vehicles a year.

Olive: Can Chrysler be fixed?

Fiat's Marchionne is taking a 'weird' approach to putting the brakes on automaker's demise

Toronto Star Nov 8, 2009

Sergio Marchionne and his executives set the appropriate tone this week at their marathon, six-hour-long unveiling of Chrysler's rescue strategy. The strategy is bizarre, and so was the meeting.

In his impassioned windup to the more than 300 industry analysts, dealers, government officials and auto journalists gathered at Chrysler's headquarters in suburban Detroit, Marchionne quoted Bill Clinton, Machiavelli and Bobby McFerrin.

Weird.

Marchionne, who spent most of his career in Toronto before a short stint with an Italian firm brought him to the attention of a then-crippled Fiat, had allowed earlier in the day that he bought a Fiat in 1968 in Toronto and was not impressed.

"If you had told me then I would be running Fiat, I would have laughed my head off."

Chrysler's salvation, should it come about, is entirely tied to its "Fiat-ization." To the adoption of Fiat styling, engine and drivetrain technology, and supposedly state-of-the-art manufacturing methods.

Decades after Fiat was driven out of a North American market where it had failed dismally, the stigma of "Fix it again, Tony" still falls readily from the lips of auto enthusiasts when the word Fiat is mentioned. Why remind us?

Weird.

Fiat's Canadian boss bragged that Chrysler's upscale Town and Country minivan, assembled in Windsor, is moving through Canadian showrooms like "chickenpox through a kindergarten class." Veteran auto analyst Nick Bunkley, who was live-Twittering the event, tweeted: "I can't make this crap up."

Marchionne has had precious little to say about his plan to restore Chrysler to viability since it exited bankruptcy in June. He did give one interview in which he complained that Chrysler was in much worse shape that he had imagined. A real confidence builder, that. Marchionne was at it again on Wednesday, boosting morale with his observation that Chrysler's in trouble "but it's not terminal"

This desultory tone was consistent with Marchionne's regard for Chrysler since Day One last spring. He insisted then that he would not take the reins at Chrysler, until Washington told him that was not on. He held out for a gratis 35 per cent stake in Chrysler until Barack Obama told him that was too greedy. (Marchionne had to settle for 20 per cent.)

He made war on Chrysler dealers by loading them up with inventory and then shutting them down. He fired the heads of the Dodge and Chrysler brands, posts to which he had just promoted them, when they broke Marchionne's directive not to talk to the auto press at the Frankfurt auto show. Omniscience and pettiness aren't an ideal mix in a turnaround CEO, whose troops already balk at keeping Marchionne's work hours. (The boss gets by on four hours' sleep.)

Despite four months to prepare, Wednesday's crucial tone-setting presentation fell flat. Not only from the gaffes, but the shoot-the-moon goals Marchionne proclaimed, described by one of the analysts at the Detroit event as "boldly delusional."

As one executive after another talked of doubling sales of a brand or boosting market share by unrealistic amounts, there were collective gasps in the audience. What are these guys smoking?

Still, it was a friendly audience. The auto press would love a Chrysler comeback story. There had to be a less petty way for Marchionne to deal with unstated skepticism than to say it is a "worldwide sport of beating people who are down."

The truth about Chrysler is that it's not down, but out. In a glut of global capacity, what the industry needs is for this chronically mismanaged firm to go away. Instead, Washington, Ottawa and Queen's Park have extended a total of about $14 billion in emergency loans to a company that hit the wall in the early 1970s, again a decade later, and survives now only on government life support – the latter an expression of goodwill that Marchionne might someday show some appreciation for.

Fiat has none of its own money on the line in this latest gambit to make Chrysler sustainably viable. It got its 20 per cent equity stake in the firm in exchange for taking on the task of fixing it. Marchionne has vowed not to commit a single euro of Fiat's own money to reviving Chrysler. Fair enough, since Fiat itself is bleeding cash back home in Europe.

In a nutshell, Marchionne proposes to spend $23 billion (U.S.) to develop 21 new bestselling vehicles that will roughly double Chrysler's North American market share in the short space of three or four model years. To make Chrysler profitable in just two or three years – something that earlier Chrysler owner Daimler AG could not do in nine years – and to pay off its $14 billion in government emergency loans by 2014.

Chrysler's sales volume has cratered by 50 per cent over the past two years. Its year-over-year market share has plummeted to 7.9 per cent in October from 11.3 per cent.

Where is the $23 billion (U.S.) going to come from, if not from Fiat? From a miraculous upturn in sales of Chrysler's current, unpopular product line, which will get a slapdash sprucing-up (inexpensive improvements to interiors, exterior trim and so on).

"It's cosmetics," shrugged Rebecca Lindland, of IHS Global Insight, telling the Detroit Free Press she cannot imagine that showroom dust-collectors like the Chrysler Sebring and Dodge Avenger are suddenly going to move like H1N1 through a crowded subway car.

Those 21 new Fiat-based models won't start arriving at Chrysler dealers for at least two years – the time needed to retool Chrysler plants, and for Chrysler hands to learn Fiat's manufacturing methods. That's too late. A resurgent Ford Motor Co. will have replaced its entire lineup by then. Also, its other rivals won't be watching grass grow under their feet.

The real problem is the Fiat-ization of Chrysler. Americans have never taken to Fiat styling. Fiat is the unlikeliest candidate to erase Chrysler's abysmal reputation for poor quality. Fiat itself ranks in the bottom quarter of more than 20 brands in J.D. Power's latest customer satisfaction survey in the company's core European market.

The word crapshoot comes to mind to describe what Marchionne is embarked on, that's how pie-in-the-sky it is. Except in that game, you play with your own money.

Inflatable seatbelts
coming to Ford Explorers

Bryce G. Hoffman / The Detroit News - Nov 6, 2009

Dearborn --For Srini Sundararajan, the new inflatable seat belt system that Ford Motor Co. debuted Thursday represents the culmination of a decade of work and the realization of his dream to make automobile transportation safer.

The 47-year-old biomedical engineer has spent nearly half of his 21-year career at Ford working on the first-ever system, which will debut on the new Ford Explorer next year and promises to provide unprecedented protection for back seat passengers -- particularly for children and the elderly.

"It's exciting. It's thrilling," he said Thursday. "We are finally done!"

Ford's new system incorporates small air bags inside the rear seat belts. These are deployed during a crash, spreading the force of impact over five times more area of the body than conventional seat belts, thereby greatly reducing pressure on the chest and helping to control head and neck motion.

Dr. Stewart Wang, a leading trauma surgeon at the University of Michigan and an expert on automobile crash injuries, said Ford's new seat belt air bag could be a real life saver -- especially for children and the elderly who are most vulnerable and most often sit in the rear passenger seats.

"It's hard to know for sure ahead of time, but this air bag has tremendous benefit by increasing the surface area (of the seat belt), and that allows them to restrain the torso better on a frail body," he said. "I think that the potential benefits are quite substantial."

Ford said the optional safety device, the first ever offered by an automaker, will ultimately be available on all of its cars and trucks worldwide for a "modest" additional cost.

The company unveiled its first prototype of the new safety system at the Detroit auto show in 2001. Since then, Sundararajan has led the team working to take the seat belt air bag from the show stand to the showroom. He says it has been an arduous journey.

The original plan was to put the system in the trunk of the vehicle, but Sundararajan said it rattled. He and his team then moved to other configurations before fixing on a location beneath the rear seats.

That worked, but the system was too expensive.

"We wanted to make it affordable for everybody," Sundararajan said. "That was a real challenge."

Ford wants to make this a mainstream offering.

That is why it is breaking with its recent practice of introducing new cutting-edge technologies in its Lincoln brand and only making them available on Ford products a year or two later.

"This is really about improving family safety, and we really think the Explorer fits that," said Sue Cischke, Ford group vice president in charge of sustainability, environmental and safety engineering.

Analyst Erich Merkle of Autoconomy.com said the seat belt air bag will resonate with parents, adding that it builds on other safety innovations the automaker has introduced in recent years that have helped the Dearborn automaker claim more five-star safety ratings from the federal government than any other manufacturer.

"Safety certainly gives you a competitive advantage," he said. "It's one more thing Ford is doing right."

Stay Home if You Have Swine Flu, Unless You Work at Wal-Mart

Ford Workers Should Be Applauded, Not Ridiculed

by Norm Kujawa | Mon, 11/04/2009

Editor’s note: Ford workers rejected a proposed concessions package last week that included a six-year wage freeze for new hires (who make half of current workers’ pay), combining of skilled trades, and giving up the right to strike for contract improvements. Ford had made some weak assurances of continued work and offered a $1,000 bonus.

The United Auto Workers announced the vote as 70 percent 'no' among production workers and 75 percent 'no' in skilled trades. UAW President Ron Gettelfinger’s home local in Louisville, Kentucky, voted no by 84 percent. The Dearborn Truck unit, whose president broke with International officials to urge a ‘no’ vote, rejected by 92.5 percent.

The pre-vote period was characterized by rank-and-filers producing leaflets that they distributed in the plants, and at least one raucous meeting in which UAW VP Bob King was shouted down.

UAW officials said they would not bring the concessions package back for a re-vote but would wait until the contract expires in fall 2011 to negotiate again.

To read how the Detroit newspapers tell it, you would think that union members dealt a death blow to Ford Motor Company when UAW-Ford workers voted overwhelmingly against another round of concessions to their 2007 contract. Rather than place blame for a corporate failure that may not occur, news media should applaud union members for doing something they have not done in over 30 years – vote against the wishes of their top union leaders.

While published reports have said that Ford will have a large, business-threatening debt load in 2011, workers in 2009, eight months after giving concessions at their leadership’s request, do not see the urgency to give more to Ford, especially since Ford reported financial gains in the second quarter, and—right after the vote—announced a $1 billion profit for the third quarter.

Concessions were double-edged idea

The drive to ask the membership for concessions was likely a double-edged idea from Ford management and UAW leaders, long known for their labor-management harmony. Management, seeking to reduce the predicted debt load and reach competitive equality with General Motors and Chrysler, whose workers were forced to give concessions due to the GM and Chrysler bankruptcy filings, thought workers would be understanding of their needs and voluntarily give up more from their contract, even while seeing increased sales and profits since voting to help the company with previous concessions.

The UAW sought to maintain pattern bargaining, a staple of the union since Walter Reuther’s days as president. Pattern bargaining, done by the UAW for over 60 years, was always a tool to bring the workers in the weakest bargaining position to equality with workers in the strongest bargaining position. This is the first time that pattern bargaining has been attempted to bring the strongest company down to achieve the pattern with the poorer companies.

With the GM and Chrysler concessions last May, Ford workers stood ahead of their brethren in many areas, including entry worker pay, job classifications, and work rules. Instead of waiting out the contract, the UAW chose to bring the Ford workers in line with GM and Chrysler workers now, at a time when Ford has been selling the government, the media, the public, and Wall Street on the idea that their business plan, management team, and labor relations are the best of the three U.S. auto companies.

No clear explanation

Ford workers said throughout the process that they had given back enough and did not see the necessity in giving the company more from their contract while increased sales and profits were being announced. They certainly do not feel that they have to endure the same pain that GM and Chrysler workers were forced to endure by the U.S. government. Yet the International UAW kept insisting that the concessions were necessary, without clearly explaining the financial situation that Ford may find themselves in in two years.

Attempts were made by Ford management to tell workers how bad the business situation might be in two years. Executives were sent to plants around the country to give slide show presentations and give gloom-and-doom speeches. After the tentative agreement was reached, UAW-Ford negotiators traversed the same path across the country to explain the concessionary agreement to a confused membership. The necessity to give concessions to a company announcing profits certainly confused many union members, and is something that UAW members have not seen before.

Several employees, not wanting to risk the future of their plant, voted for the concessions. Several plants were promised product if the agreement passed, while others would be considered for product. Giving up the right to strike and freezing wages for new hires for six years, not just the remainder of the current contract, was not a concern to those that voted for the agreement.

Workers change course

Unconvinced of Ford’s impending 2011 failure and tired of being asked to foot the bill for management’s business failures, UAW members at Ford chose not to stand by but to be an active participant in the labor relations process. Management, with the UAW’s buy-in, was able to present a good business case for concessions just a few months previously. They have not done so in this instance.

In the past, workers went for the money. This time, despite a $1000 bonus offered if the agreement passed, workers declined the money and instead stood up for what they believed was right. The years of being told they had to sacrifice again and again had finally taken a toll.

Some reporters and bloggers have said that UAW members cannot see the big picture, and undoubtedly Ford management and UAW leadership feel the same way, but asking for concessions while telling the world of your profitability simply isn’t smart.

Shop floor a forgotten place

While UAW members get ridiculed for making too much money, having too good a benefit package, and apparently not understanding big business, the know-it-all commentators and those negotiating concession packages have either forgotten, or know nothing about, the shop floor and working conditions auto workers perform under.

Today’s auto factories are nothing like the factories of decades ago, but the culture and environment inside the auto factories is still highly stressful. The much-talked-about relationship between Ford management and the UAW has not rolled down to the shop floor. In the real Ford plant world, employees have to deal with supervisors that care more about the numbers of product being produced than how it is being done, and management that seemingly cares more about climbing the next rung on the corporate ladder than managing effectively.

These realities, coupled with a selection process that discourages the best candidates from getting involved in union leadership, has led to a chaotic environment that places workers in a survival mode where every day brings new challenges, new drama, non-stop politics, and few escapes from the pressure that workers constantly find themselves under. Fixing the way business is conducted inside plant locations would go a long way toward fixing the mindset of the workforce where harmonious labor relations, spoken so highly of at the corporate level, are just a fantasy.

Workers have been beaten down by the media, the general public, and their own union and company leadership for so long, it should not have been a surprise to anyone that the concessions agreement was voted down. Those that were surprised simply are out of touch with the reality of worklife inside an auto plant. Perhaps this is the beginning of a new workers revolution, one that will gain the respect of those that negotiate on their behalf and redefine the direction of the UAW.

[Norm Kujawa was editor of the UAW Local 3000 Guide for 17 years. Local 3000 represents workers at AutoAlliance, the Mazda-Ford joint venture in Flat Rock, Michigan.]

St. Thomas plant closure
may doom 10,000 jobs

Nov 4, 2009 Canadian Press

The closure of Ford's assembly plant in St. Thomas, Ont., will not only affect the 1,400 workers currently employed at the facility, but also thousands more in the auto parts and transport industries.

Auto industry analyst Bill Pochiluk says approximately 2,500 jobs will be lost among auto parts suppliers in both Canada and the United States as a result of the closing.

And Canadian Auto Workers economist Jim Stanford says as many as 10,000 jobs in total could be lost due to the spinoff effects on the community of St. Thomas and surrounding areas.

The plant's closure will also cost the St. Thomas area more than $3 million in tax revenue.

The St. Thomas region of southwestern Ontario has been hit hard by the distress in the Canadian manufacturing sector and the auto industry in particular.

Stanford says it's probably the second-hardest hit community in Canada after Windsor, Ont.

FORD CANADA POSTS FIFTH CONSECUTIVE YEAR-OVER-YEAR SALES INCREASE; SALES UP 20%

Led by double-digit increases of Ford Fusion
and Taurus October Highlights:

• Overall vehicles sales were up 20% compared to last October
• Car sales increased 8% compared to same period last year
• Ford Taurus sales rose 57%
• Ford Fusion sales were up 65%
• Ford Mustang sales increased 8%
• Ford Flex sales rose 38%, best October on record
• Ford Edge sales were up 38%, best October on record
• Ford Escape sales increased 19%, best October on record
• Ford F-Series sales were up 59%
• Ford Explorer sales increased 21%
• Ford Expedition sales were up 46%
• Lincoln MKX sales rose 90%
• Overall Lincoln sales jump 22%

OAKVILLE, Ontario, November 3, 2009 – Ford Motor Company of Canada, Limited saw sales increase 20.1 per cent compared to the same period last year marking the company's fifth consecutive month of year-over-year sales gains. Strong sales were led by the award-winning Ford Taurus, which was recently named "Best New Family Car" in the over $30,000 category by the Automobile Journalists Association of Canada (AJAC).

Also, Ford Fusion and Ford Taurus delivered strong performances with sales increases of 64.5 per cent and 57.1 per cent respectively.

October also marked the twelfth consecutive month of market share growth, with cars and trucks from both Ford and Lincoln showing sales increases.

"We are making steady progress and remain fully focused on our plan to build a strong and sustainable Ford," said David Mondragon, president and CEO, Ford of Canada. "Consumers are seeing the signs of recovery and are gaining confidence in the quality, fuel efficiency, safety and smart technology incorporated in our new product lineup. In fact, 90 per cent of our sales come from our new models."

In addition to the 8.4 per cent increase in car sales, total truck sales were up 23.6 per cent compared to last October. The results were driven by products like the Ford Taurus, Fusion, Escape and F-Series along with the Canadian-built Ford Flex, Ford Edge and Lincoln MKX.

Due to its overwhelming success, Ford is extending its 'Recycle Your Ride' program through until January 4, 2010. With this program, consumers turning in 15-year-old (or older) vehicles for recycling will get up to $3,000 toward the purchase of a new vehicle. Ford's scrappage program builds on the Canadian government's 'Retire Your Ride' initiative which offers $300 and other benefits to eligible participants. So far, Ford of Canada has been able to scrap 1,419 clunkers under the program -- more than any other automaker.

"The Recycle Your Ride program is helping Canadians afford new vehicle ownership and is great for the environment because these older, high-polluting vehicles are taken off the road," said Mondragon. "The key to the success of Ford's program is reaching out to dealers and consumers directly so that getting a refund from the program is fast and easy."

Ford Motor Company of Canada, Limited
October 2009 Vehicle Sales

Gettelfinger says failed Ford pact worth modest price

DETROIT -- UAW President Ron Gettelfinger (pictured) said today that the Ford-UAW contract modifications rejected overwhelmingly by Ford's 41,000 hourly U.S. workers would have saved the automaker just $30 million.

In a phone interview today, Gettelfinger said he pushed the modest concessions to lock in future product commitments at Ford plants and to bring the Ford agreement with the UAW into pattern with union agreements with General Motors Co. and Chrysler Group.

Gettelfinger said a little-publicized provision of the modifications would have allowed the UAW to call a strike at Ford if the company failed to meet its product commitments. The UAW had no such provision to strike over product commitments in its GM and Chrysler contracts, he said.

A key reason that rank-and-file voters opposed the new concessions was wording that required binding arbitration over any bargaining impasses in the 2011 contract talks.

Gettelfinger said the UAW agreed to binding arbitration to bring the Ford contract into pattern with no-strike clauses negotiated this year with GM and Chrysler.

“In good times, you establish a pattern, and in bad times, you stay with the pattern,” Gettelfinger said.

He said he saw no long-term damage resulting from the contract rejection either to Ford or the UAW.

The UAW announced today that 70 percent of voting Ford production workers rejected the contract, while skilled trades workers turned it down by 75 percent.

Gettelfinger said that after paying each of the 41,000 hourly workers a $1,000 bonus called for in the modifications, or $41 million, the contract would have saved Ford just $30 million.

Ford spokeswoman Marcey Evans declined to comment, except to note that the rejected modifications were more about operating improvements than saving Ford money. In addition to binding arbitration, the modifications called for combining some skilled trades and a freeze on wages for entry-level workers.

Gettelfinger said the Ford product commitments, which meant job security for union workers, were airtight and approved by Ford's board of directors.

If Ford had failed to live up to those commitments, the union had an immediate right to strike over that issue, Gettelfinger said.

The contract language also had a caveat that product commitments were subject to market demands, he acknowledged.

But “market demand” is often debatable, providing the union with the ability to strike in a close call. “It had real teeth,” Gettelfinger said.

Gettelfinger credited Ford in the negotiations with sticking to a pledge not to ask for additional concessions on retiree health care.

On Jan. 1, Ford must make a $1.9 billion payment into a UAW-administered voluntary employees' beneficiary association, with at least $1.3 billion of the amount in cash and the rest in Ford stock. In contrast, GM negotiated a much bigger reduction in the amount it must pay in cash Jan. 1 -- to $585 million.

All told, Ford must pay $6.5 billion of a $13.2 billion obligation to the VEBA in cash, while GM's cash payment is just $2.5 billion for an obligation that was $20 billion before new concessions were negotiated just before the automaker's bankruptcy filing June 1.

Said Gettelfinger: “Ford kept its word.”

UAW rejects new concessions
to Ford, no new talks

* UAW membership rejects concessionary deal with Ford
* Says Ford's Q3 results reflect workers' past concessions
* Says will not return to bargaining table

DETROIT, Nov 2 (Reuters) - The United Auto Workers union overwhelmingly rejected a proposed cost-cutting deal with Ford Motor Co on Monday, delivering a setback for the automaker as it seeks to bring its labor costs in line with U.S. rivals.

The UAW said that 70 percent of production workers and 75 percent of skilled trades workers voted to reject a proposed agreement the union leadership and Ford negotiated in October to change the 2007 contract.

The deal would have brought the automaker's labor costs in line with General Motors Co [GM.UL] and Chrysler Group LLC, both of which won additional concessions as part of their government-financed bankruptcies.

UAW President Ron Gettelfinger said in a statement the union's past concessions have positioned Ford to be a strong competitor in a tough market and its surprise quarterly net profit announced early on Monday provided further evidence of the contributions the workers have made.

"While we will not be returning to the bargaining table, our ... membership will continue to work with Ford on a daily basis in an effort to keep new products coming into our plants," Gettelfinger said.

The UAW represents about 41,000 U.S. factory workers at Ford.

STATEMENT: UAW-FORD TENTATIVE AGREEMENT RATIFICATION RESULT

Note: The following statement is attributable to Joe Hinrichs, group vice president, Global Manufacturing and Labor Affairs, Ford Motor Company.

Dearborn, Mich., Nov. 2 – We appreciate the UAW leadership for working with us to reach a tentative agreement on further modifications to our national labor agreement. Ford is disappointed that the additional changes were not ratified.

In March, the UAW-Ford membership ratified changes to the 2007 UAW-Ford national labor agreement and the Voluntary Employee Beneficiary Association health care trust that went most of the way in moving Ford to competitive parity with foreign-owned automakers. The additional modifications we sought recently were designed to honor pattern bargaining and provide Ford with similar additional efficiencies as those ratified this year for our domestic competitors. 

All of us at Ford are absolutely committed to continuing to make progress on our transformation plan, and we will take the necessary steps to be competitive with the best in the business. 

Moving forward, we will work with the UAW to discuss the next steps to ensure Ford remains competitive so we can continue to make product commitments and invest in our manufacturing facilities here in the United States.

CAW Members at Ford
Approve New Agreement

November 1, 2009

(Toronto) Thousands of CAW members working at Ford facilities in Oakville, Windsor, St. Thomas and Bramalea have voted in favour of a new agreement, ratifying the deal by 83 per cent during a series of meetings held over the past two days. The deal was reached on October 30 between the two sides.

“No one should mistake workers’ approval as satisfaction with the new agreement,” said CAW President Ken Lewenza. “Members had faith in the union to negotiate the best agreement possible and protect their interests over the long term, but the problems faced by industry cannot be resolved at the bargaining table.”

We need government and policy makers to wake up to the fact that the country’s industrial base is rapidly eroding and with it, the entire middle class.”

The deal is the second cost-cutting agreement reached between the CAW and Ford in 18 months and includes cuts to benefits, a reduction in vacation, break times and co-pays on health care, all of which were pattern items from the agreements with Chrysler and General Motors. 

During the negotiations Ford also announced it would be closing the St. Thomas assembly plant in 2011, eliminating 1,400 jobs in the already hard-hit community. Workers at the plant manufacture the Ford Crown Victoria, Mercury Grand Marquis and Lincoln Town Car.

“This has been an extremely stressful and difficult year for Ford workers, just as it has been for hundreds of thousands of workers right across the country,” said Mike Vince, chairperson of the CAW-Ford Master Bargaining Committee and president of CAW Local 200.  “Our members have been dealing with terrible insecurity as a result of financial crisis and recession and this new agreement will give a greater deal of job security right until 2012.”

The new agreement expires on September 17, 2012 and covers approximately 7,000 Ford workers.

The results by location are as follows:

CAW Local 1520, St. Thomas
Production:  80% in favour
Skilled Trades: 81% in favour
Combined total: 80% in favour

CAW Local 200, Windsor
Production: 81% in favour
Skilled Trades: 75% in favour
Combined total: 80% in favour

CAW Local 707, Oakville
Production: 90% in favour
Skilled Trades: 91% in favour
Combined total: 90% in favour

CAW Local 584, Bramalea
Total: 85% in favour

CAW Local 240
Office: 100% in favour

CAW Local 1324
Office: 83% in favour

Combined Totals:
Total Production: 84% in favour
Total Skilled Trades: 81% in favour
Total Office: 94% in favour

Overall total: 83% in favour

Ford's mantra of difference was taken to heart by its UAW workers

Nov 1, 2009 BY TOM WALSH
FREE PRESS BUSINESS COLUMNIST

UAW workers to Ford Motor Co. and Chief Executive Alan Mulally: “We think we’re OK where we are.”

That’s the clear message in a decisive rejection by Ford hourly workers of the Dearborn automaker’s latest plea for concessions on pay and work rules to match what Chrysler and General Motors gained in bankruptcy.

And it’s proof that words can come back to haunt you.

Remember Mulally’s statement of Nov. 18, 2008, testifying before Congress?

When asked whether he would work for $1 a year during the auto industry crisis, Mulally replied, “I think I’m OK where I am.” (He made $4.9 million last year in salary bonus and benefits, and was awarded stock options valued at $8.7 million.)

You can bet the rank-and-file workers remember.

They also remember Ford management’s repeated use of the word “different” over the past year, intended to set Ford apart from crosstown rivals GM and Chrysler.

If Ford is so happy being different and better off than GM and Chrysler, the workers are asking, what’s wrong with us being better off, too?

Ford was different, its executives said, because it didn't run out of cash like GM and Chrysler.

Different because it didn't take taxpayer money to survive like GM and Chrysler.

Different, different, different. Pounding the drumbeat of difference clearly has helped Ford's public image, its car and truck sales and its stock price.

But when it comes to the wages, benefits and work rules of its UAW workforce, Ford doesn't want to be different. It wants the same labor cost savings that GM and Chrysler achieved in Chapter 11 bankruptcy.

It's easy to understand, in that context, the defiance so many Ford UAW workers have shown in recent days toward coughing up another round of contract givebacks.

They're OK with being different.

That doesn't mean, however, that Ford is wrong to ask for more concessions.

Indeed, Ford must keep insisting on cost parity with GM, Chrysler, Toyota, Honda and every other major competitor if the company is to survive and prosper.

Ford's management must continue to push the envelope on costs. Otherwise, by repeating the old cycle of avoiding confrontation by appeasing its labor union, Ford risks winding up again with the bloated legacy costs and debt loads that have made the Detroit automakers so uncompetitive with foreign rivals for the last 25 years.

Alan Mulally, Ford's president and chief executive officer, along with Executive Chairman Bill Ford Jr. and the rest of the Dearborn hierarchy, have stated bluntly that Ford Motor cannot allow itself to be disadvantaged by the bankruptcies of GM and Chrysler.

And, in fact, they convinced UAW President Ron Gettelfinger and UAW Ford Vice President Bob King that the history of pattern bargaining among the Detroit Three should be kept intact. Ford should get the no-strike clause, more flexible work rules and a freeze on entry-level worker pay that GM and Chrysler had been granted.

To persuade the concessions-weary UAW workers in the Ford plants to go along, a number of promises were made about where production of future models would be located. And the jobs that go along with those decisions, of course. Workers also were offered $1,000 bonuses.

But even with those sweeteners, the UAW rank and file has turned its thumbs down.

So what now?

Wall Street lifts an eyebrow of worry about Ford's future? Gettelfinger and King, the would-be successor to Gettelfinger as UAW president, have a little egg on their faces because they couldn't deliver a ratification vote?

So what?

Both sides need to regroup, jawbone some more and do whatever it takes to ensure that Ford stays competitive and keeps its momentum.

There's no need for an immediate revote.

Nor would it be wise for Ford management to take a high-profile, obviously punitive action like relocating production of some promising new model from Michigan to Mexico.

Still, it must be steadfast about cost control. This is the Detroit auto industry's last chance to get it right. No time for weak knees.

But it should remember to choose its words carefully.

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Download the flyer in favor of contract changes (PDF)

Download the flyer in opposition to contract changes (PDF)

Ford deal with UAW
goes down to defeat

Bryce G. Hoffman and Louis Aguilar / The Detroit News

In a fatal blow to an accord with Ford Motor Co., United Auto Workers members at three of the automaker's largest locals voted Friday against ratification of the proposed contract changes.

At the Dearborn Truck Plant, 93 percent of the votes were cast against the agreement; 53 percent of workers casting their ballots at the Romeo Engine Plant voted against the deal. And at UAW Local 862 in Louisville, which represents workers at both the Louisville Assembly Plant and Kentucky Truck Plant, 84 percent voted no.

Though UAW voting will not be completed nationwide until Sunday, enough plants now have rejected the deal to make it virtually impossible for the agreement to win enough votes for approval.

"I think it's over," said Gary Walkowicz, one of union dissidents who has led the opposition to ratification. "People are saying 'No more.' We've had enough concessions already. We've given up enough already."

While the UAW pact is headed for defeat, the Canadian Auto Workers announced a tentative agreement Friday with Ford that matches concessions union members already gave to General Motors Co. and Chrysler Group LLC.

UAW members at Ford have been angered by language that limits the union's right to strike over pay and benefit increases in the next round of national contract talks in 2011.

Workers at GM and Chrysler already approved a much broader "no strike" clause as part of agreements negotiated during those companies' government-mandated bankruptcy reorganizations earlier this year.

Union dissidents say Ford already is doing better than GM and Chrysler and does not warrant the same treatment.

But UAW leaders say giving Ford at least a measure of parity with its cross-town rivals is essential to ensuring the continuation of pattern bargaining.

CAW President Ken Lewenza made a similar pitch to his members Friday.

"Pattern bargaining has done wonders for our members, and it stays in place," he said of the new deal with Ford. "Without a pattern, Ford would be trying to extract more from our members."

Deal means more work

The tentative agreement between Ford and the CAW exactly matches the terms the union negotiated with GM and Chrysler as a condition of the Canadian government's bailout of those automakers earlier this year -- including a wage freeze for the life of the contract, a freeze on cost-of-living adjustments after June, the elimination of one paid week off and increased insurance co-payments.

In exchange, Ford agreed to add additional work at its Windsor engine factory and committed to bring a new global platform to its Oakville Assembly Plant sometime after 2012. About 10 percent of Ford's North American production will remain in Canada, which is equal to its sales there.

But Ford will close its assembly plant in St. Thomas, Ontario, in September 2011 when production of the Ford Crown Victoria and Lincoln Town Car ends. That means approximately 1,400 Ford CAW members there will lose their jobs, along with about 6,000 workers employed by suppliers and other companies that support Ford's operations there, according to the union.

"This is devastating for Canada," Lewenza acknowledged, though he said the CAW had negotiated "good" severance benefits for its members, along with a commitment by Ford to offer early-retirement packages at its plants in Windsor and Oakville that could create openings for workers who want to stay at Ford.

Lewenza said the only alternatives were much worse.

"They actually talked about disinvesting in Canada if we didn't extend the pattern to them," he said.

"Our costs are high, relative to U.S. plants -- particularly given the strength of the loonie."

Workers at some UAW plants that voted against the new deal with Ford also are worried that they could lose work if the agreement fails to win ratification.

UAW members at Ford's axle factory in Sterling Heights began circulating a petition Friday calling for a revote after local leaders warned that Ford could transfer new products promised to that plant to a German supplier.

However, UAW President Ron Gettelfinger told reporters later that he would not approve another vote.

More locals reject Ford pact

On Thursday, workers at three more U.S. Ford factories voted against the proposed contract changes, which also would freeze wages and benefits for new hires and give the company greater flexibility in how it deploys employees.

Workers at two Chicago-area complexes soundly rejected the modifications Thursday, as did UAW members at Ford's parts factory in Saline.

Approximately 80 percent of workers at UAW Local 588, which represents workers at Ford's Chicago Stamping Plant, voted against the deal, while 70 percent voted no at UAW Local 551, which represents the Chicago Assembly Plant. At Saline, 75 percent of workers voted against ratification.

While the UAW is not releasing official figures until voting is completed, at least 11 locals now have rejected the agreement. At least four have voted in favor of ratification. A simple majority of Ford's 41,000 UAW-represented workers must approve the deal for it to pass.

While Lewenza stressed that the UAW vote is "not relevant to our decisions here," he said CAW members are certainly aware of the surprise opposition to the U.S. agreement. But he urged them to think differently.

"Our members face a critical choice," Lewenza said.

"Ford is not in good financial shape. ... They have a lot of debt."

What Ford does have, he said, is new product that is beginning to win back consumers in both Canada and the United States, and he said workers need to do what they can to help the company's turnaround succeed.