Ford To Book $600 Million Charge On New Agreement With UAW

Ford Motor Co. said it expects to book a $600 million charge this year related to its new collective bargaining agreement with the United Auto Workers union. Ford said the agreement which covers about 53,000 employees in the U.S., "aligns our labor cost structure more closely with our competition and improves our manufacturing productivity and staffing flexibility." Specifically, the agreement ends a cap on entry-level employment, improves its ability to use temporary workers and alternative work schedules and will put it on a more even footing with rivals such as General Motors Co. . The company's labor costs will rise by less than 1.5% a year, including ratification and lump sum bonuses. Ford has committed to investing $9 billion in its U.S. plants, and expects to create or secure 8,500 hourly jobs in Michigan, Illinois, Kentucky, Missouri, New York and Ohio. Shares were slightly higher in premarket trade, but are down 6.3% in the year so far, while the S&P 500 has gained 1.5%.