The six-week strike by the US automaker union United Auto Workers ford has reduced sales by about 100,000 vehicles and cost the company $1.7 billion (1.56 billion euros) in lost profits this year. As a result, the US automaker lowered its profit forecast on Thursday and now expects a profit of 10 to 10.5 billion dollars for the current year. Last summer, Ford had forecast profits of $11 to $12 billion.
Ford was the first of the three major US automakers to agree to a collective bargaining agreement with the union after nearly six weeks of strikes. The additional labor costs resulting from the agreement will total $8.8 billion by the end of the contract term. This translates into around $900 per vehicle by 2028, explained CFO John Lawler, according to a company statement. Ford will work to offset these costs through increased productivity and reduced expenses.
The strike led to production losses for highly profitable trucks and SUVs. UAW workers had shut down the company’s largest and most profitable plant in Louisville, Kentucky, which makes large SUVs and heavy-duty pickup trucks.
In the first nine months of the current year, the company generated a net profit of $4.9 billion and a pre-tax profit of $9.4 billion.
The UAW strike began on September 15 and affected Ford assembly plants and other facilities, General Motors and the Jeep manufacturer Stellantis. The rebellion ended at Ford on October 25th.