01-28-11  Come March, Ford Motor Co. — not Uncle Sam — will cut checks averaging $5,000 for thousands of workers at its Claycomo plant.

That’s the reward for a work force that contributed to producing Ford’s best annual profit in 11 years after surviving perhaps the U.S. auto industry’s darkest period.

“For most of our members, this is more evidence that all the hard work and sacrifices we’ve made in the last few years are starting to pay off,” said Jeff Schmidt, bargaining chairman of United Auto Workers Local 249.

Ford on Friday reported a 2010 net profit of $6.6 billion, more than double what it made in 2009. It also eliminated 40 percent of its debt last year. Ford took on heavy debt so that it could avoid bankruptcy and a government bailout, unlike General Motors and Chrysler.

Ford also increased its market share for the second straight year — from 15.5 percent to 16.7 percent — passing Toyota to become the No. 2 sales leader in the country behind No. 1 General Motors.

Ford’s momentum has been reflected in its local operations. After months of speculation about the Claycomo plant’s future, Ford recently said it would bring a new vehicle to it to replace the Ford Escape, ensuring job security for about 4,000 people. Ford also makes F-150 pickup trucks at Claycomo.

Despite the big profit for the year, Ford’s stock dropped 13.4 percent Friday. Its fourth-quarter profit of $190 million was less than Wall Street had been expecting, held down by rising costs in North America, disappointing results in Europe and a big charge for retiring debt.

But the stock is up 42.6 percent from a year ago and nearly 65 percent since it swooned in the middle of 2010. And Ford dealers on Main Street remained impressed with the automaker’s performance.

“Things are looking good,” said Mark Smith, president of Dick Smith Ford in Raytown. “If Ford makes money, they can reinvest in products. That’s good for the dealers. From what I’ve seen, Ford is No. 1 among consumers considering buying a new car. That is a huge indication of the progress being made.”

Industry analysts echoed that view.

“First, they’re making money,” said George Magliano, director of auto industry research at IHS Global Insight, a consulting firm. “Second, they’re retiring debt, and third, they’re generating cash. Ford is sticking to its plan, and it’s certainly showing up in their performance.”

Ford CEO Alan Mulally, a Lawrence native, joined the automaker in late 2006 and has improved the company in terms of products and technology, said Jesse Toprak, vice president of industry trends and insights for Truecar.com.

“Alan came in and turned the company around with fuel-efficient … vehicles consumers like and technology such as the Ford Sync (that) consumers wanted in their vehicles,” Toprak said in a statement.

Ford Sync is the communications and entertainment system installed now in most of its vehicles, allowing drivers to use voice commands to use their cell phone or music player, among other functions.

Ford reduced what it spent on incentives but gained market share, “which is a healthy sign for an automotive company,” Toprak said.

And a healthy bottom line will mean that profit-sharing checks for Ford’s 41,000 hourly workers will average $5,000. That will be the biggest payout in 10 years, since checks for 2000 averaged $6,700. That also will dwarf last year’s profit-sharing of $450 for each hourly employee.

Earlier reports had circulated that Ford production workers could receive profit-sharing checks of $10,000 or more, leading company and union officials to temper expectations earlier this week.

Both sides said the profit-sharing formula changed after Ford sought concessions in the union’s national contract in 2007, when the auto industry began its descent.

The actual payout would have been less than $5,000 had Ford relied strictly on the profit-sharing formula, said Marcey Evans, a company spokeswoman.

“The company felt that $5,000 was more representative of the employees’ contribution,” she said.

Schmidt, the local bargaining chairman, said the UAW went to Ford leaders in Dearborn, Mich., in hopes of persuading them to increase the payout, citing the several concessionary agreements that workers took to keep Ford afloat. Ford’s domestic competitors, General Motors and Chrysler, both received federally assisted bankruptcy reorganization in 2009.

“We asked for them (Ford management) to consider an increase as a good-faith gesture based on the sacrifices our members made,” Schmidt said. “They took it to heart, obviously. I’m optimistic that this bodes well for bargaining that’s coming up.”

Ford and the other domestic automakers will enter bargaining sessions this year as national contracts expire in September. Many analysts think the UAW will seek to regain some of the benefits that were lost during the downturn.

For now, Schmidt said he would focus on writing about the recent developments for the Claycomo plant in Local 249’s newsletter. That includes the profit-sharing checks as well as Ford’s investment in the new plant.

“I’ve had to write about bad stuff for so many years,” he said. “It’s great to have some good news for a change.”

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Submitted by andie531 on Sat, 2011-01-29 19:16

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