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Ford-UAW Deal Doubles Hamburg Work Force

If Approved, Pact Also Gives Plant Blanking Line

By Matt Glynn

News Business Reporter

Published:
October 4, 2011
 
Ford Motor Co.'s Buffalo Stamping Plant in Hamburg would receive $136 million in new investment and add 400 new jobs under a tentative deal between the automaker and the United Auto Workers.

The UAW announced the investment plan Tuesday, and Rep. Brian Higgins, D-Buffalo, said senior Ford officials told him the deal would lead to the rehiring of 120 laid-off workers and the creation of 400 jobs at the Route 5 plant.

"This announcement is a direct sign of confidence in that plant and its work force," Higgins said.

The agreement calls for the Hamburg plant to continue to stamp parts for the Ford Flex and Edge and the Lincoln MKT and MKX, and to receive "incremental stampings in support of future product programs," the UAW said. A new blanking line, which cuts sheet metal to be fed into a stamping line, would also be installed.

Ford and union leaders approved the four-year deal Tuesday after a meeting in Detroit. The deal is subject to a vote by Ford's workers, and voting is expected next week. Workers at Local 897 in Hamburg might vote Oct. 16.

If the deal is approved, it would provide a needed boost to the Hamburg plant. Last month, some workers were laid off after Ford closed an assembly plant it had supplied near St. Thomas, Ont.

Patrick Radtke, Local 897 chairman and president, called the agreement "fantastic."

"There's a lot of good things in this agreement for the working people of America," he said. The Hamburg plant has about 540 active hourly workers and about 120 on layoff, he said.

Sen. Charles E. Schumer had spoken recently to Ford's chief executive officer, Alan Mulally, to make the case for the Hamburg plant.

"The announcement from Ford is everything we asked for" in both jobs and investment, Schumer said Tuesday.

"It means they keep this plant going for a long, long time," he added.

Schumer said Mulally praised the plant's work force and told him the site fit into the automaker's plans.

Radtke said the promise of a new blanking line is notable. He said the plant's blanking equipment was taken out several years ago, and the work was outsourced. But he said the automaker has had quality issues with its vendor and wants more control over the process.

Ford plans to add 5,750 U.S. factory jobs under the deal, on top of 6,250 it announced earlier this year, for a total of 12,000 jobs by 2015. It also pledged to invest $4.8 billion in its U.S. factories.

Ford will pay its U.S. factory workers a $6,000 signing bonus.

Most Ford workers will get profit-sharing checks instead of annual raises under the deal, starting with a payment of around $3,700 this year. Workers will also get around $7,000 in inflation protection and lump-sum payments over the life of the contract, the UAW said.

Arthur Wheaton, an auto industry expert at the Cornell University School of Industrial and Labor Relations in Buffalo, called the deal good for the Hamburg plant and predicted it will be ratified.

"I'm glad to see an additional investment after they lost the Crown Victoria line," he said, referring to the assembly plant it had supplied near St. Thomas.

And any new products or increased output at the Oakville, Ont., plant will be good news for Hamburg, given the two plants' close ties, he said.

Wheaton wonders if the Hamburg plant could have a shot at supplying product to a Ford plant roughly six hours away in Flat Rock, Mich., which would serve as a second production source for the Ford Fusion. The vehicle is now produced exclusively in Mexico.

"Flat Rock from Buffalo is not too bad a trip," he said.

Higgins noted that Ford's planned investment in Hamburg follows General Motors' announcement of two new engine lines for its Town of Tonawanda site. Those two GM investments were valued at a combined $825 million.

"I don't think this is coincidental," Higgins said. "When you have a skilled work force to deal with, that's where you're going to put your new investment."

Workers at GM -- which also has a plant in Lockport -- have already approved a contract.

The Ford investment would also help offset the loss of the region's last American Axle & Manufacturing plant, in Cheektowaga, which is set to close early next year.

Nationally, approval of the Ford-UAW contract could be bumpy. There is some anger among Ford members about Mulally's $26.5 million pay package last year, and many Ford workers say the company is healthy enough to offer annual raises. Ford earned $6.6 billion last year.

UAW leaders said the contract keeps Ford's costs and prices competitive but allows workers to share in Ford's profits.

The Associated Press contributed to this report.

mglynn@buffnews.comnull