Ford Claims Transplant Wage Parity. Yes. Well.

John Horner
by John Horner
ford claims transplant wage parity yes well

Senator Corker must be so proud of himself. He held Ford’s feet to the fire . . . oh, no, wait, Ford didn’t bother with that meeting. Anyway, today Ford is crowing [via AP] that its revised UAW contract gets close enough to wage parity with the transplants to call it a done deal. Which is kind of strange, because Ford’s accounting puts the all-in costs under the newest deal at $55/hour compared to the $48-$49 number people toss around for the transplants. Hmmm, maybe I’ll try that kind of “close enough” math when I pay my bills. Ford’s spin-meisters could have pointed out that nobody outside the transplants really knows what they are paying, but they didn’t. Absent a published union contract, all we can do is guess.

Ford is also very excited about getting rid of the jobs bank. Yes, well, FoMoCo remains on the hook for 26 or 52 weeks (depending on seniority) of unemployment supplementary payments for laid off workers. As previously reported, Ford is also going to get to make half of its [Mother of all Health Care funds] VEBA contributions with freshly-minted company stock—provided said stock doesn’t fall below $1/share. All of which is not going to matter much if sales stay at recent dismal levels.

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4 of 9 comments
  • John Horner John Horner on Mar 12, 2009
    Out of curiosity when was the last time Ford stock was worth more than GM? The price per share number isn't the important point of comparison, because Ford and GM don't have the a similar number of shares outstanding. The relevant comparison is total market capitalization, which is the price per share multiplied times the number of shares outstanding. As of today's close, GM's total market cap is $1.14 Billion and Ford's is $4.70 Billion. The markets value Ford's common stock at more than four times that of GM.

  • Redrum Redrum on Mar 12, 2009

    The supplementary unemployment income doesn't sound out of line with other industries. A few years back I worked for a large company (non-union and not related to auto) that was bought out. Laid off workers received a month's severance for every year with the company, up to six months. On the other hand, if Ford is only paying out as long as the person is on unemployment, that's a rather large disincentive to finding another job.

  • Dynamic88 Dynamic88 on Mar 12, 2009

    If the numbers are right, I'm ready to say close a-fricking-'nough. That might not work for bill paying, but it sure works for the old argument that Detroit can't compete because of labor costs. Does anyone think it might be the quality of the cars?

  • Kevin Kevin on Mar 12, 2009

    Well I'm glad Ford is talking about this. It'll make it interesting to hear what excuses they'll have in the future for losing money and getting their butts kicked by the foreign devils.