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Ford contract, aluminum truck parts discussed


Post Date: 26 Jan 2015    Viewed: 320

A Ford Motor Co. executive on Friday carefully skirted high-stakes questions about how the resurging automaker will handle labor contract negotiations this year with its hourly workers.

Instead, John Fleming, Ford's executive vice president of global manufacturing and labor affairs, echoed recent remarks from United Auto Workers leaders, saying that the automaker and the union are "aligned" on the goal of ensuring that Ford remains competitive after a new pact is reached later this year.

Fleming, who spoke at the Governor's Luncheon which concluded the annual Kentucky Transportation Conference hosted by Kentuckians for Better Transportation, gave a brisk talk, using a PowerPoint and few notes, that touched on Ford's expanding reach around the world and its pride in having Kentucky manufacture some of its best-known products, the Escape SUV and Lincoln Navigator, among them.

The native of Liverpool, England joined Ford in 1967 and rose to lead the company's European operations before taking the top executive position over manufacturing and labor relations. He also touched briefly on an significant development for the Kentucky Truck Plant, which Fleming said is in line for manufacturing Super Duty trucks using many aluminum body parts and components.

The vehicles are made primarily of steel now.

The remarks were the first official confirmation from Ford executives about the role KTP will play in the transition to aluminum. Investors learned last fall that after the transition to aluminum for the F-150 at plants in Dearborn, Mich. and Kansas City, Super Duty would be next in line.

"Our view is this (F-series) truck has been the best-selling truck in the U.S … leaders need to lead," Fleming told the luncheon crowd that included Gov. Steve Beshear and several hundred paving and contracting company employees, legislators and engineering consultants.

Of the UAW contract talks, Fleming said that he's confident that Ford and autoworkers can reach a deal to allow the company to be "even more competitive" in the future. "I believe that's even more deliverable than ever," he said.

Detriot's Big Three automakers' contract with the UAW expires in September, and both Ford and labor leaders have been preparing for talks that begin officially this summer. UAW president Dennis Williams said last month that he recognizes the need for Ford, GM and Chrysler to remain competitive with Toyota and other Asian automakers, but he still intends to insist workers should share in recent gains.

That means a raise for "legacy" workers – those hired before 2007 — who are earning $28 an hour and more, but haven't had a base salary hike in nearly a decade.

UAW leaders have pledged also to demand Ford shrink the pay gap between Tier 2 workers, who start at $15.78 an hour and continue to trail Tier 1 or legacy workers, as the automakers have posted enormous profits. An earnings report due out this Thursday is expected to shed more light on Ford's 2014 performance, where some recalls and the launch of the new F-150 pickup truck cut in to overall profits in an otherwise strong year.

On Friday, Fleming shied away from discussing specifics about the labor negotiations in which he's expected to play a key role. He said that the company has given pay increases to employees through the profit-sharing checks — $8,800 to the average worker last year and that the lower-tier wages had allowed Ford to increase employment and return, or in-source, jobs back to the U.S.

As for the future of the KTP's foray into aluminum production, the next re-design of the Super Duty will include the new, lighter body and engine components, but Fleming declined to say whether that would come in 2016 or later. He also wouldn't offer a ballpark in the cost to make the transition to aluminum, even though he said "it's a major change."

The steel components of the trucks are welded with robots. With aluminum, Fleming said, "you rivet … it's a different method of putting the vehicle together."

The KTP, with roughly 3,900 employees, is running at nearly full capacity with three crews working around the clock in part of the plant and crews on two shifts in other areas. A year ago, Ford executives announced $80 million in construction and interior upgrades to expand capacity – with 350 additional employees.

Fleming said that the addition is providing room for storing parts and for additional paint shop space. He echoed other officials in saying that there's a potential to add additional workers at the facility on Chamberlain Lane in 2015, but that will depend on the market.

"I think he was very upbeat about the future," Paul Steely, a director on the Kentucky Aviation Association's board who attended the conference. "He seems very committed to the state of Kentucky." 


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