Ford on UAW negotiations: ‘we are at the limit’

Ford Motor Co (NYSE: F) says it can’t offer more to the United Auto Workers than it already has. Its shares ended down 2.0% on Thursday.  

Why can’t Ford Motor offer more to UAW

The legacy automaker did not reveal the cost it will incur if the UAW accepted its current offer.

It did, however, tell media and analysts today that going any further will risk its ability to operate. According to Kumar Galhotra – the president of traditional operations at Ford Motor:

We’ve been very clear that we are at the limit. We stretched to get to this point. Going further will hurt our ability to invest in the business like we need to invest.

In particular, what it means is that the car company will have to dial back on expanding its footprint in electric vehicles if it offered more in terms of concessions to its workers on strike.

Per a Ford source, the union asked Ford this afternoon for a meeting at 5:30 p.m. today with a new economic counteroffer.

When Ford said it did not have one, Shawn Fain stood up & said “You just lost Kentucky Truck.”

The meeting took about 10 minutes.

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— Michael Martinez (@MikeMartinez_AN) October 11, 2023

UAW extended its strike against Ford today

Galhotra also said today that Ford Motor is onboard if the union wants to shuffle the money but only within the offer that’s already on the table.

His statement arrives only hours after the United Auto Workers expectedly extended its strike to a Kentucky factory where Ford makes its highly profitable pickup trucks and sport utility vehicles (SUVs).

According to Shawn Fain – President of UAW – the escalation was because Ford Motor repeated its previous offer instead of proposing additional benefits.  

Last week, the multinational automobile manufacturer reported a 7.7% increase in its third-quarter U.S. sales. Its shares are currently down 22% versus their year-to-date high.