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<blockquote data-quote="Weather Man" data-source="post: 17009966" data-attributes="member: 137766"><p><h3>Ford CEO calls UAW standoff a 'watershed' moment</h3><p>Feb. 15, 2024 11:39 AM ET<a href="https://seekingalpha.com/symbol/F?source=content_type%3Areact%7Csection%3Amain_content%7Csection_asset%3Ameta%7Cfirst_level_url%3Anews%7Csymbol%3AF" target="_blank">Ford Motor Company (F) Stock</a>By: <a href="https://seekingalpha.com/author/sa-editor-clark-schultz?source=content_type%3Areact%7Csection%3Amain_content%7Csection_asset%3Ameta%7Cbutton%3Aauthor_name%7Cfirst_level_url%3Anews" target="_blank">Clark Schultz</a>, SA News Editor<a href="https://seekingalpha.com/news/4067736-ford-ceo-calls-uaw-standoff-a-watershed-moment#comments" target="_blank">2 Comments</a></p><p><img src="https://media.gettyimages.com/id/1232993986/photo/ford-motor-companys-chief-executive-officer-jim-farley-poses-next-to-the-newly-unveiled.jpg?b=1&s=594x594&w=0&k=20&c=nLOypygQrI4Oh8KGMaWua5kdvjMI6HCIRuDKiVmfa3g=" alt="US-AUTOMOBILE-ENVIRONMENT-FORD" class="fr-fic fr-dii fr-draggable " style="" /></p><p>JEFF KOWALSKY/AFP via Getty Images</p><p>Ford Motor (NYSE:<a href="https://seekingalpha.com/symbol/F?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews" target="_blank">F</a>) CEO Jim Farley weighed in on the automaker's labor challenges during an appearance at the Wolfe Research Global Auto Conference on Thursday. Farley said the Detroit auto giant will think carefully about where it builds new vehicles following the standoff with the United Auto Workers union during the fall.</p><p>Farley <a href="https://seekingalpha.com/pr/19625514-ford-ceo-says-company-will-rethink-where-builds-vehicles-after-last-years-autoworkers-strike?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews" target="_blank">noted</a> the transition from internal combustion to electric vehicles means Ford (<a href="https://seekingalpha.com/symbol/F?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews" target="_blank">F</a>) will have to be strategic with its manufacturing decisions. He highlighted that Ford has kept is pickup truck production in the U.S. even as some competitors built plants in Mexico. Farley said Ford thought it was the right kind of cost to take on to maintain a good relationship with the UAW, although the company ended up paying a price and may alter future decisions.</p><p>"Our reliance on the UAW turned out to be we were the first truck plant to be shut down... Really our relationship has changed. It's been a watershed moment for the company. Does this have business impact? Yes."</p><p>High manufacturing costs are one of main reasons why Ford (<a href="https://seekingalpha.com/symbol/F?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews" target="_blank">F</a>) has a $7B annual cost disadvantage to competitors, according to Farley. Ford (<a href="https://seekingalpha.com/symbol/F?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews" target="_blank">F</a>) is working on lower some key expenses, and aims to offset the higher costs tied to the new UAW contract. Looking ahead, Ford (<a href="https://seekingalpha.com/symbol/F?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews" target="_blank">F</a>) expects to take out $2B worth of costs this year.</p><p><strong>Sector watch</strong>: Recent developments in the electric vehicle sector indicate that Mexico is in a powerful position to broker a 'Westernized' China-based EV supply chain, according to Morgan Stanley. "Given the ambiguities and loopholes embedded in the IRA as it is currently written, EVs produced in Mexico with the help of Chinese equipment and industrial know-how offer a potentially viable, if somewhat uncomfortable, path to on-shoring low cost EVs," observed analyst Adam Jonas. The race to Mexico appears to have already started with several reports of Chinese auto industry suppliers setting up plants in Mexico to supply Tesla's (<a href="https://seekingalpha.com/symbol/TSLA?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews" target="_blank">TSLA</a>) upcoming gigafactory in the region and with BYD Company (<a href="https://seekingalpha.com/symbol/BYDDF?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews" target="_blank">OTCPK:BYDDF</a>) notably looking to set up shop in Mexico as well.</p></blockquote><p></p>
[QUOTE="Weather Man, post: 17009966, member: 137766"] [HEADING=2]Ford CEO calls UAW standoff a 'watershed' moment[/HEADING] Feb. 15, 2024 11:39 AM ET[URL='https://seekingalpha.com/symbol/F?source=content_type%3Areact%7Csection%3Amain_content%7Csection_asset%3Ameta%7Cfirst_level_url%3Anews%7Csymbol%3AF']Ford Motor Company (F) Stock[/URL]By: [URL='https://seekingalpha.com/author/sa-editor-clark-schultz?source=content_type%3Areact%7Csection%3Amain_content%7Csection_asset%3Ameta%7Cbutton%3Aauthor_name%7Cfirst_level_url%3Anews']Clark Schultz[/URL], SA News Editor[URL='https://seekingalpha.com/news/4067736-ford-ceo-calls-uaw-standoff-a-watershed-moment#comments']2 Comments[/URL] [IMG alt="US-AUTOMOBILE-ENVIRONMENT-FORD"]https://media.gettyimages.com/id/1232993986/photo/ford-motor-companys-chief-executive-officer-jim-farley-poses-next-to-the-newly-unveiled.jpg?b=1&s=594x594&w=0&k=20&c=nLOypygQrI4Oh8KGMaWua5kdvjMI6HCIRuDKiVmfa3g=[/IMG] JEFF KOWALSKY/AFP via Getty Images Ford Motor (NYSE:[URL='https://seekingalpha.com/symbol/F?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews']F[/URL]) CEO Jim Farley weighed in on the automaker's labor challenges during an appearance at the Wolfe Research Global Auto Conference on Thursday. Farley said the Detroit auto giant will think carefully about where it builds new vehicles following the standoff with the United Auto Workers union during the fall. Farley [URL='https://seekingalpha.com/pr/19625514-ford-ceo-says-company-will-rethink-where-builds-vehicles-after-last-years-autoworkers-strike?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews']noted[/URL] the transition from internal combustion to electric vehicles means Ford ([URL='https://seekingalpha.com/symbol/F?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews']F[/URL]) will have to be strategic with its manufacturing decisions. He highlighted that Ford has kept is pickup truck production in the U.S. even as some competitors built plants in Mexico. Farley said Ford thought it was the right kind of cost to take on to maintain a good relationship with the UAW, although the company ended up paying a price and may alter future decisions. "Our reliance on the UAW turned out to be we were the first truck plant to be shut down... Really our relationship has changed. It's been a watershed moment for the company. Does this have business impact? Yes." High manufacturing costs are one of main reasons why Ford ([URL='https://seekingalpha.com/symbol/F?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews']F[/URL]) has a $7B annual cost disadvantage to competitors, according to Farley. Ford ([URL='https://seekingalpha.com/symbol/F?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews']F[/URL]) is working on lower some key expenses, and aims to offset the higher costs tied to the new UAW contract. Looking ahead, Ford ([URL='https://seekingalpha.com/symbol/F?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews']F[/URL]) expects to take out $2B worth of costs this year. [B]Sector watch[/B]: Recent developments in the electric vehicle sector indicate that Mexico is in a powerful position to broker a 'Westernized' China-based EV supply chain, according to Morgan Stanley. "Given the ambiguities and loopholes embedded in the IRA as it is currently written, EVs produced in Mexico with the help of Chinese equipment and industrial know-how offer a potentially viable, if somewhat uncomfortable, path to on-shoring low cost EVs," observed analyst Adam Jonas. The race to Mexico appears to have already started with several reports of Chinese auto industry suppliers setting up plants in Mexico to supply Tesla's ([URL='https://seekingalpha.com/symbol/TSLA?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews']TSLA[/URL]) upcoming gigafactory in the region and with BYD Company ([URL='https://seekingalpha.com/symbol/BYDDF?hasComeFromMpArticle=false&source=content_type%253Areact%257Csection%253Amain_content%257Cbutton%253Abody_link%257Cfirst_level_url%253Anews']OTCPK:BYDDF[/URL]) notably looking to set up shop in Mexico as well. [/QUOTE]
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