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Last Updated: Thursday, 22 December 2005, 22:45 GMT
Ford gains union healthcare deal
Ford Escape
All three big US car producers are aiming to reduce healthcare costs
Ford has secured a deal with its main union that will help it save an annual $850m (498m) in healthcare costs.

The vote by members of the United Auto Workers (UAW) union was however close, with only 51% voting in favour.

Under the change, both retired and current Ford workers will have to pay extra for healthcare provision.

The Ford agreement was closely modelled on a similar deal achieved by rival General Motors. Fellow US car firm Chrysler is also seeking such a move.

Tough times

All three firms are trying to reduce their giant healthcare obligations in the face of tough trading conditions.

As each has seen sales hit by increased competition from Japanese rivals and reduced consumer spending, their generous healthcare costs have been seen as an extra financial burden.

Ford expects to spend $3.5bn on healthcare this year, 13% more than in 2004.

In October it reported a third quarter loss of $284m.


SEE ALSO:
Ford aims to copy GM's union deal
19 Oct 05 |  Business
Chrysler hopes to follow GM deal
18 Oct 05 |  Business
GM signs health deal with unions
17 Oct 05 |  Business
Bridgestone ends Ford recall row
12 Oct 05 |  Business
Ford and GM vehicle sales plummet
03 Oct 05 |  Business
Ford to take on 23 Visteon plants
13 Sep 05 |  Business


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