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Ford Healthcare Costs to Top $1 Billion Next Year
Ford Motor Co. projects the cost of healthcare coverage for its 56,000 hourly employees in the U.S. will top a record $1 billion in 2020, Bloomberg News reports.
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Ford Motor Co. projects the cost of healthcare coverage for its 56,000 hourly employees in the U.S. will top a record $1 billion in 2020, a source tells Bloomberg News.
The figure is certain to come up this summer when Ford begins contract talks with the United Auto Workers union. Healthcare costs are likely to be a key negotiation point this year for all the unionized domestic producers.
Ford’s hourly workers currently pay only 3% of the cost of their medical coverage—one-tenth as much as salaried employees pay for their insurance, Bloomberg reports. One of its sources says maintaining the current scheme for hourly workers through the next three-year contract would be the equivalent of a $3 boost in hourly pay.
Spiraling healthcare costs are a disincentive for carmakers to add jobs or even maintain current employment levels in the U.S. But Bloomberg points out that the UAW isn’t like to budge on the issue. The union considers medical coverage as compensation for a decade of concessions on wages and work rules to help the domestic industry survive the 2009 economic recession.
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