UAW AND FORD REACH TENTATIVE AGREEMENT ON FUTURE FUNDING OF THE VEBA HEALTH CARE TRUST
Editor’s Note: The following statement is attributable to Joe Hinrichs, group vice president, Global Manufacturing and Labor Affairs, Ford Motor Company.
Dearborn, Mich., Feb. 23 – The United Auto Workers union and Ford Motor Company have reached a tentative agreement on modifications to the Voluntary Employee Beneficiary Association (VEBA) retiree health care trust.
We are pleased with this agreement, which provides us the option to settle with Ford common stock up to 50 percent of the payments into the VEBA in lieu of cash. We will consider each payment when it is due and use our discretion in determining whether cash or stock makes sense at the time, balancing our liquidity needs and preserving shareholder value.
The VEBA agreement – together with the agreement reached Feb. 15 by Ford and the UAW to modify certain operating provisions of the 2007 National Labor Agreement – is subject to ratification by the active UAW-Ford membership and other conditions, including pursuing restructuring actions with other stakeholders. Additionally, the VEBA agreement requires court approval.
The agreements, if finalized, will allow Ford to become competitive with foreign automakers’ U.S. manufacturing operations, and are critical to our efforts to operate through the current deep economic downturn without accessing government loans and continue to fully invest in our ONE Ford product plan.
I would like to thank the entire UAW leadership and national bargaining committee – particularly UAW President Ron Gettelfinger and UAW Vice President Bob King – for their leadership during these important discussions. I also would like to thank Ford’s national bargaining team for their tireless efforts over the past few weeks.
All of us at Ford will continue to work with all of our stakeholders to participate in the current industry restructuring and improve our company’s overall competitiveness.