Proactive Investors - After the United Auto Workers began striking Ford Motor Company (NYSE:F) most profitable factory, a Ford executive said Thursday that the automaker is “at the limit” of concessions it can offer its roughly 57,000 UAW employees.
Kumar Galhotra, president of Ford’s traditional operations, said that while there’s room to move money around within the existing offer to better match the UAW’s priorities, the automaker has reached a line on economic concessions.
“We’ve been very clear that we are at the limit. We stretched to get to this point,” Galhotra said during a media and analyst call. “Going further will hurt our ability to invest in the business like we need to invest.”
Galhotra declined to say how much the company’s current offer to the UAW would cost Ford.
Ford executives were shocked by the union’s decision to strike its Kentucky Truck plant, which employs 8,700 workers and produces Super Duty pickups and Lincoln Navigator SUVs, two high-margin vehicles.
“We’re surprised by the escalation last night,” Galhotra said. “Kentucky Truck Plant is one of the most important manufacturing plants of any kind in America.”
Meanwhile, UAW President Shawn Fain said Ford hasn’t taken any steps to improve its offer.
“This offer was the exact same offer they gave us two weeks ago. In our position, they’re not taking it seriously,” Fain said during a pre-recorded online video.
“We’ve been very patient working with a company on this. At the end of the day, they have not met expectations. They’re not even coming to the table on it.”
Ford’s most recent offer included 23%-26% wage increases, retention of platinum health care benefits, reinstatement of cost-of-living adjustments (COLA), ratification bonuses and other benefits.
The UAW originally called for a 40% wage increase, among other benefits.
Fain is scheduled to speak on Facebook (NASDAQ:META) Live at 10 am ET on Friday, when he could introduce additional strike targets against Ford or the other Detroit automakers, General Motors Company (NYSE:GM) and Stellantis NV (LON:0QXR).
Talks with both GM and Stellantis were expected to resume Thursday, according to reports.