© Reuters.
Investing.com — Shares of Ford Motor Company (NYSE:) rose slightly in U.S. premarket trading on Monday after the auto giant reached a tentative labor agreement with the United Auto Workers union that It would end long-running strikes at some of the company’s plants.
On Sunday, the UAW outlined the main parts of the four-and-a-half-year deal, which includes $8.1 billion in investments in factory renovations and wage increases of at least 30% for many workers over the life of the contract. At the top range, some permanent employees would receive an additional $70,000 in salaries, while the salaries of the lowest-paid temporary workers would increase by 150%.
It would also erase a measure by Ford to cut costs by offering lower wages to workers in component factories than those in vehicle assembly plants.
In exchange for these concessions, Ford would retain the right to purchase the contracts of an unlimited number of older workers with maximum salaries of $50,000. The Michigan-based automaker could replace them with younger employees who earn less than the maximum salary for three years.
The UAW president described the agreement, which must still be approved by union members, as a demonstration of the “incredible power” workers can have in labor negotiations. The protracted talks have been characterized by UAW pressure on Ford, as well as peers General Motors (NYSE:) and Stellantis (NYSE:), through strikes at an increasing number of the companies’ plants.
Stellantis, owner of Chrysler, and the UAW also reached a tentative agreement over the weekend. However, negotiation is ongoing between the union and GM, and Reuters reported that discussions have reached an impasse over retiree pension costs.
