Ford's UAW Contract: $8.8 Billion Costs and Revised Profit Guidance
Ford Motor Co. announced that its labor costs in North America will increase by $8.8 billion due to the 2023 UAW contract, with an anticipated cost of about $900 per vehicle by 2028. Ford plans to offset these costs through higher productivity and lower expenses, while also improving quality and identifying new sources of revenue. The company expects adjusted earnings before interest and taxes (EBIT) of $10 billion to $10.5 billion in 2023, including $1.7 billion in strike-related lost profits. Ford CEO Jim Farley is committed to electric vehicles but is also focusing on providing hybrid vehicles. Investors have expressed concern about Ford's warranty repair and recall costs.