From Detroit Free Press

Preliminary details of the tentative labor contract reached between the UAW and Ford Motor Co. show that the union extracted a rosier pact than many people had expected out of Detroit’s most financially fragile automaker.

According to information provided to the Free Press by a top bargainer and another person familiar with the talks — neither of whom wanted to be identified because details of the deal have not been officially released to autoworkers — the deal says:

Six of the 16 plants slated for closure under Ford’s Way Forward turnaround plan have been spared and will remain open through the contract. While Ford had publicly identified 10 of the plants slated for closure, the final six, which were slated to close after 2008, had not been named.

Two Michigan plants that had seemed vulnerable are safe. The Wayne Assembly Plant that builds the Ford Focus is slated to receive another new product to build after the current model is phased out in three or so years. And the Michigan Truck Plant in Wayne, which builds the big SUVs consumers no longer favor, remains “part of the overall plan.”

Ford secured favorable new provisions for incoming hires, although the precise terms are still not clear. This is considered distinctive from the pattern agreement the UAW established with General Motors Corp. and Chrysler LLC, which set a new lower wage for workers doing what is deemed “non-core” work, like janitorial services.

Another round of buyouts will be offered to autoworkers at Ford, so the automaker can hire new workers under the more favorable terms to replace older UAW workers earning a compensation package that is estimated to cost $20 to $30 more per hour than non-union workers are paid at U.S. plants operated by Toyota Motor Corp. and Honda Motor Co.

It is unclear how many hourly workers Ford will look to shed under the new buyout program.

Under the Way Forward plan announced last year, the automaker said it wanted to reduce 25,000 to 30,000, or 35 percent, of its 85,600 hourly workers in North America by the end of 2008.

Ford has already achieved that. When Ford releases its third-quarter earnings results on Thursday, the automaker will also announce that about 33,000 hourly workers, in all, left the company under the prior buyout offering, according to a person familiar with the figures. Approximately 6,000 of those were Ford workers employed by Automotive Components Holdings, a Ford subsidiary.

That means Ford actually reduced about 27,000 hourly workers at its non-ACH factories.

The Ford-UAW deal includes a provision shifting retiree health-care oversight to the union, according to a company statement, which did not disclose the level of funding for the trust or whether new hires would come in at a second tier of wages and benefits.

The union reached a similar agreement with GM and Chrysler, which shifts billions in future obligations off the automakers’ books.

"Though we will not discuss the specifics of the tentative agreement until after it becomes final, we believe it is fair to our employees and retirees, and paves the way for Ford to increase its competitiveness in the United States," said Joe Laymon, Ford group vice president for human resources and labor affairs.

Ford’s financial position is considered fragile. The 104-year-old Dearborn, MI, automaker lost a record $12.6 billion in 2006 and it is expected to lose money again this year, despite a first-half profit of nearly half a billion dollars.

The UAW said in a statement that details of the new agreement will officially be provided to union members at explanation and ratification meetings at UAW Ford local unions. No time frame was given for ratification.

UAW President Ron Gettelfinger said in a statement that the talks were successful.

"Our team is proud of each and every negotiator because they have encouraged Ford to invest in product and people while addressing the economic needs of our active and retired members," Gettelfinger said.

UAW Vice President Bob King, who directs the union’s national Ford department added: "Our goals for this contract were to win new product and investment, to enhance job security and protect seniority – and we made progress in all these areas."

Ford said it was also pleased with the process.

"I’d like to take this opportunity to thank UAW President Ron Gettelfinger, UAW Vice President Bob King and the entire UAW national bargaining committee for all of their hard work and professionalism over the past several months," Laymon said. "I would also like to thank the Ford bargaining team for its skill and dedication during this complex and challenging set of negotiations."

Several Wall Street analysts previously told the Free Press that any Ford move to scale back its turnaround plan would be viewed as negative, unless substantial cost savings were achieved in other areas.

"It would be viewed as a significant negative," Mark Warnsman, an auto analyst for Calyon Securities and the former controller for product development finance for Ford’s Jaguar and Land Rover operations, previously told the Free Press.

"We’d be looking for Ford to be doing more in the way of reducing capacity, rather than backing off those commitments, especially since we haven’t seen an increase in consumer demand."