Ford Motor Co. reinstated its 2023 guidance and said the recently ratified United Auto Workers contract will cost the company $8.8 billion, a bill that will get passed down to customers.
In a business update Thursday, the automaker said the contract will cost $8.8 billion by the time it expires in 2028. The six-week strike, which started in mid-September. cost the company $1.7 billion.
Ford said it expects to add $900 to each of its vehicles next year as the company moves to pass on the cost of the strike and the contract to its customers.
In its update, Ford also adjusted earnings before interest and taxes from its original guidance of $12 billion down to $10 billion. It also announced an adjusted free cash flow of $5.5 billion.
Ford’s estimates come as the auto industry begins adjusting to UAW’s contracts. This week, General Motors announced its cost estimates and reinstated its 2023 guidance. GM expects the contract to cost the company $9.1 billion and said vehicle prices will rise next year.
The final of the Big Three automakers entangled in the strike, Chrysler and Jeep parent Stellantis, has not announced its cost expectations.
The UAW contracts, ratified at all three companies in November, provide big wage and benefit increases to their unionized workers.
• Vaughn Cockayne can be reached at vcockayne@washingtontimes.com.
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