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DETROIT – The United Auto Workers union and Ford Motor have reached a tentative agreement that will end a nearly six-week strike at the automaker, the union announced Wednesday night.
The tentative agreement, which was first reported earlier by CNBC, includes 25% pay increases over the terms of the agreement, reinstatement of cost-of-living adjustments and other significantly enhanced benefits.
“We told Ford to pony up and they did. We won things nobody thought was possible,” UAW President Shawn Fain said during a video posted online Wednesday night. He said the value of Ford’s offer increased by 50% compared to when the targeted strikes began Sept. 15.
The deal still must be approved by local UAW leaders and then ratified by a simple majority of Ford’s 57,000 union-represented workers.
Autoworkers who are currently on strike with Ford will return to work while the union’s approval and voting process occurs, UAW Vice President Chuck Browning said during the video with Fain.
“Like everything we’ve done during this ‘stand-up’ strike, this is a strategic move to get the best deal possible,” he said. “We’re going back to work at Ford to keep the pressure on Stellantis and GM. The last thing they want is for Ford to get back to full capacity while they mess around and lag behind.”
Shares of Ford were up by roughly 2% during afterhours trading. The stock closed Wednesday at $11.54 per share, up 1.3%. Shares are down less than 1% this year.
The automaker and the union participated in intense bargaining Tuesday and Wednesday in an attempt to finalize a record deal, according to the sources.
Spokespeople with Ford, which has offered the best proposals of any of the three Detroit automakers for weeks, declined to comment on the negotiations earlier Wednesday other than to say talks were ongoing. A UAW spokesman did not respond for comment.
The talks this week involved a proposal for wage increases of at least 25% over the term of the deal as well as other improved benefits previously outlined by the union and company, two sources confirmed to CNBC.
The UAW and Ford as well as its crosstown rivals General Motors and Stellantis have been locked in negotiations largely around the economics of the deals since the sides failed to reach new contracts covering 146,000 autoworkers by a Sept 14 deadline.
The union initiated negotiations with all three automakers at once, breaking from recent history when UAW leaders would bargain with each automaker individually, select a lead company to focus efforts on and then pattern the remaining deals off a leading tentative agreement.
Ford reports its third-quarter results after the markets close Thursday.