Ford Adds 12,000 Hourly Jobs in U.S. Plants Under UAW Accord
Members of the United Auto Workers (UAW), including president Bob King, center left, shake hands with executives from Ford Motor Co. Jeff Kowalsky/Bloomberg
By Keith Naughton and Craig Trudell - Oct 4, 2011 9:18 AM CT
Ford Motor Co. (F) said it has committed to add 12,000 hourly jobs in its U.S. manufacturing plants by 2015 as part of a four-year tentative agreement with the United Auto Workers.
The figure includes 5,750 more UAW jobs than a previously announced 6,250 hourly positions to be added by the end of 2012, Executive Vice President John Fleming said at a news conference in Dearborn, Michigan. Ford will be “in-sourcing” jobs from Mexico, China and Japan, the company said in a statement. The union said it will release details later today
The agreement is subject to a ratification vote by Ford’s 41,000 U.S. hourly workers. General Motors Co. (GM) workers approved a new contract, the union said Sept. 28. The UAW said it’s still negotiating with Chrysler Group LLC, which has extended the deadline to reach a deal to Oct. 19.
“Ford wanted an agreement that gave them parity with GM and Chrysler,” said Kristin Dziczek, a labor analyst with the Center for Automotive Research in Ann Arbor, Michigan. “This is still a pretty sluggish recovery. Ford is doing financially well now, but fortunes change very quickly in this industry.”
The UAW is negotiating contracts for 113,000 workers at U.S. automakers for the first time since GM and Chrysler went bankrupt in 2009. Workers at Ford, the only company to avoid Chapter 11, have said they are seeking more from the automaker they helped save. Only Ford workers can go on strike in these negotiations because GM and Chrysler employees agreed not to walk out as part of their U.S.-backed reorganizations.
Credit Rating
“This agreement recognizes that Ford would not have turned the corner had it not been for the commitment and dedication of its workers,” Jimmy Settles, the UAW vice president who oversees the union’s Ford department, said in an e-mailed statement.
Standard & Poor’s Ratings Services may raise Ford’s debt ratings, depending on details of its UAW agreement. Ford’s corporate credit rating is now BB-. It may be upgraded to BB+, the highest non-investment grade, if the labor accord is ratified and it “does not place Ford at a significant disadvantage” to GM, the ratings company said Sept. 29. S&P raised GM to BB+ from BB- because of its new contract.
The majority of the 12,000 jobs Ford is adding will be workers making entry-level wages, said Marcey Evans, a Ford spokeswoman. Wages for those so-called Tier-2 workers have started at about $14 an hour, half of what senior workers make. Ford has said it has fewer than 100 UAW-represented workers receiving the lower wage rate.
Labor Costs
“It’s our opportunity for bringing in new people,” said Fleming, Ford’s manufacturing and labor chief. The jobs “will help us with our overall labor costs by hiring in Tier-2 people.”
Ford had discussed adding as many as 10,000 jobs in the U.S. as part of the talks, according to three people familiar with the negotiations. As many as 4,000 of those jobs would be related to making the Fusion midsize sedan, which is currently made in Hermosillo, Mexico, in the U.S., one of the people has said.
“One of the areas we really concentrated on was jobs,” said Marty Mulloy, Ford’s vice president of labor affairs, who added that bargainers for both sides worked through the night to complete details on the new hires.
Ford said it pledged to invest $16 billion in the U.S., including $6.2 billion for its plants in the country. Of the amount going to U.S. factories, $1.4 billion was previously announced for assembly plants in Missouri and Kentucky, and two factories that make batteries and transmissions in Michigan.
The company said it would defer to the UAW for the release of additional details about new investments.
Mulally’s Role
UAW President Bob King has said a pay package Ford awarded to Chief Executive Officer Alan Mulally this year makes it more difficult to get member support for a deal. Ford has said it must lower hourly labor costs that are higher than those at GM and Chrysler.
Mulally’s 2010 compensation rose 48 percent to $26.5 million. In addition, Ford rewarded Mulally in March with $56.6 million in stock for leading the automaker’s turnaround. King called Mulally’s compensation “excessive” and “outrageous” in a July interview with Bloomberg Television.
Mulally was involved in the talks “every day, often two and three times a day,” while in Russia and Asia the past week working on the company’s expansion plans there, Fleming said.
Workers at Ford also have filed an “equality of sacrifice” grievance against the automaker after salaried workers received raises, tuition assistance and 401(k) matches last year. The two sides met with an arbitrator Sept. 15.
Ford’s Wages
Ford shares fell 22 cents, or 2.4 percent to $9.15 at 10:15 a.m. in New York Stock Exchange composite trading.
Ford, based in Dearborn, has said it has the highest labor costs of the three union-organized U.S. automakers, at $58 an hour including benefits. Detroit-based GM’s labor costs are $56 an hour, according to the Center for Automotive Research in Ann Arbor. Chrysler has said its labor costs are about $50 an hour.
The second-largest U.S. automaker earned $4.95 billion in the first half of the year, as fuel-efficient models like the Fiesta subcompact attracted buyers. Ford’s U.S. light-vehicle sales are up 11 percent this year through September, ahead of the industrywide gain of 10 percent.
Ford earned $9.28 billion in the past two calendar years after $30.1 billion in losses from 2006 through 2008. The automaker borrowed $23.4 billion in late 2006, putting up all major assets including its blue oval logo as collateral. That helped Ford avoid the bankruptcies and bailouts that befell the predecessors of GM and Auburn Hills, Michigan-based Chrysler.
Strike Allowed
The union agreed not to strike Chrysler or GM as part of their U.S. government-backed bankruptcy reorganizations, allowing unresolved differences to be settled in binding arbitration. UAW members at Ford, which didn’t receive a U.S. bailout, rejected a strike ban.
“Ford’s membership has proven they’ll turn an agreement down, so they’ve got a track record,” Dziczek said today in a phone interview. “There’s been a lot of talk and dissatisfaction among the membership in public, but I think the UAW leadership has a good read on what the membership wants, and what they’ll accept and what they won’t.”
The new GM contract calls for boosting starting pay of entry-level workers to at least $14.78 an hour from $14. That wage rises to as much as $19.28 an hour by 2015 from a previous maximum of $16.23.
GM’s labor costs will rise 1 percent a year under its new contract, the smallest increase in four decades, GM said Sept. 28.
Signing Bonuses
GM agreed to pay a signing bonus of $5,000 for each union member. Chrysler had balked at signing bonuses that high, wanting its bonus to be about $3,500, according to two people familiar with the discussions, who asked not to be identified because the negotiations are private.
A raise for entry-level workers would be more costly at Fiat SpA-controlled Chrysler compared with GM or Ford. Chrysler, with about 25,500 UAW-represented employees, has said it has at least 12 percent of its workers at the entry-level rate while the rest are senior workers who are paid about twice as much.
About 4 percent of GM’s U.S. hourly workers are paid the entry-level wage, the UAW has said.
GM will offer buyout packages worth as much as $75,000 to its roughly 10,000 skilled-trades workers, the UAW said in a Sept. 20 briefing with reporters. Other employees eligible to retire can take $10,000 to stop working within two years so that GM can replace them with new hires at the lower wage rate.
To contact the reporters on this story: Keith Naughton in Dearborn, Michigan at knaughton3@bloomberg.net; Craig Trudell in Southfield, Michigan at ctrudell1@bloomberg.net To contact the editor responsible for this story: Jamie Butters at jbutters@bloomberg.net
AP Exclusive: Who’s following you on Twitter or Facebook? Maybe CIA’s ‘vengeful librarians’
By Associated Press, Published: November 4, 2011
McLEAN, Va. — In an anonymous industrial park in Virginia, in an unassuming brick building, the CIA is following tweets — up to 5 million a day.
At the agency’s Open Source Center, a team known affectionately as the “vengeful librarians” also pores over Facebook, newspapers, TV news channels, local radio stations, Internet chat rooms — anything overseas that anyone can access and contribute to openly.
From Arabic to Mandarin Chinese, from an angry tweet to a thoughtful blog, the analysts gather the information, often in native tongue. They cross-reference it with the local newspaper or a clandestinely intercepted phone conversation. From there, they build a picture sought by the highest levels at the White House, giving a real-time peek, for example, at the mood of a region after the Navy SEAL raid that killed Osama bin Laden or perhaps a prediction of which Mideast nation seems ripe for revolt.
Yes, they saw the uprising in Egypt coming; they just didn’t know exactly when revolution might hit, said the center’s director, Doug Naquin.
The center already had “predicted that social media in places like Egypt could be a game-changer and a threat to the regime,” he said in a recent interview with The Associated Press at the center. CIA officials said it was the first such visit by a reporter the agency has ever granted.
The CIA facility was set up in response to a recommendation by the 9/11 Commission, with its first priority to focus on counterterrorism and counterproliferation. But its several hundred analysts — the actual number is classified — track a broad range, from Chinese Internet access to the mood on the street in Pakistan.
While most are based in Virginia, the analysts also are scattered throughout U.S. embassies worldwide to get a step closer to the pulse of their subjects.
The most successful analysts, Naquin said, are something like the heroine of the crime novel “The Girl With the Dragon Tattoo,” a quirky, irreverent computer hacker who “knows how to find stuff other people don’t know exists.”
Those with a masters’ degree in library science and multiple languages, especially those who grew up speaking another language, “make a powerful open source officer,” Naquin said.
The center had started focusing on social media after watching the Twitter-sphere rock the Iranian regime during the Green Revolution of 2009, when thousands protested the results of the elections that put Iranian President Mahmoud Ahmadinejad back in power. “Farsi was the third largest presence in social media blogs at the time on the Web,” Naquin said.
The center’s analysis ends up in President Barack Obama’s daily intelligence briefing in one form or another, almost every day.
After bin Laden was killed in Pakistan in May, the CIA followed Twitter to give the White House a snapshot of world public opinion.
Since tweets can’t necessarily be pegged to a geographic location, the analysts broke down reaction by languages. The result: The majority of Urdu tweets, the language of Pakistan, and Chinese tweets, were negative. China is a close ally of Pakistan’s. Pakistani officials protested the raid as an affront to their nation’s sovereignty, a sore point that continues to complicate U.S.-Pakistani relations.
When the president gave his speech addressing Mideast issues a few weeks after the raid, the tweet response over the next 24 hours came in negative from Turkey, Egypt, Yemen, Algeria, the Persian Gulf and Israel, too, with speakers of Arabic and Turkic tweets charging that Obama favored Israel, and Hebrew tweets denouncing the speech as pro-Arab.
In the next few days, major news media came to the same conclusion, as did analysis by the covert side of U.S. intelligence based on intercepts and human intelligence gathered in the region.
The center is also in the process of comparing its social media results with the track record of polling organizations, trying to see which produces more accurate results, Naquin said.
“We do what we can to caveat that we may be getting an overrepresentation of the urban elite,” said Naquin, acknowledging that only a small slice of the population in many areas they are monitoring has access to computers and Internet. But he points out that access to social media sites via cellphones is growing in areas like Africa, meaning a “wider portion of the population than you might expect is sounding off and holding forth than it might appear if you count the Internet hookups in a given country.”
Sites like Facebook and Twitter also have become a key resource for following a fast-moving crisis such as the riots that raged across Bangkok in April and May of last year, the center’s deputy director said. The Associated Press agreed not to identify him because he sometimes still works undercover in foreign countries.
As director, Naquin is identified publicly by the agency although the location of the center is kept secret to deter attacks, whether physical or electronic.
The deputy director was one of a skeleton crew of 20 U.S. government employees who kept the U.S. Embassy in Bangkok running throughout the rioting as protesters surged through the streets, swarming the embassy neighborhood and trapping U.S. diplomats and Thais alike in their homes.
The army moved in, and traditional media reporting slowed to a trickle as local reporters were either trapped or cowed by government forces.
“But within an hour, it was all surging out on Twitter and Facebook,” the deputy director said. The CIA homed in on 12 to 15 users who tweeted situation reports and cellphone photos of demonstrations. The CIA staff cross-referenced the tweeters with the limited news reports to figure out who among them was providing reliable information. Tweeters also policed themselves, pointing out when someone else had filed an inaccurate account.
“That helped us narrow down to those dozen we could count on,” he said.
Ultimately, some two-thirds of the reports coming out of the embassy being sent back to all branches of government in Washington came from the CIA’s open source analysis throughout the crisis.
Market Data 
Markets 
AI
