KANSAS CITY, Mo. (AP) — A contract deal that Ford Motor Co. reached Tuesday with the United Auto Workers will mean about a $1 billion investment and hundreds of new jobs for a suburban Kansas City Ford plant, and was hailed by Gov. Jay Nixon as a "historic" boost to manufacturing in the state.
Nixon, a Democrat, called a special legislative session last summer authorizing up to $100 million of tax breaks to entice Ford to continue making vehicles at its Claycomo plant in the Kansas City area, where Ford Escapes and F-150s are manufactured.
To offset the cost of the new tax breaks, Nixon also placed on that agenda an overhaul of the state's main pension system that requires new workers to pay a portion of their wages toward their retirement benefits and to work longer before drawing benefit
In a statement issued shortly after the four-year Ford contract was announced Tuesday, Nixon characterized it as the "culmination of more than two years of negotiations between my administration and Ford," and as a "strong sign that Missouri will be a manufacturing state for generations to come."
The contract, which was approved by Ford union leaders, is now subject to a vote for Ford's workers, likely next week.
Nixon also said the contract deal, which includes $1 billion in upgrades and investments at Claycomo and the addition of a commercial van to the plant's line, will mean 1,600 more automotive jobs in Kansas City. The Claycomo plant now has about 3,800 workers.
"This is a historic day for Missouri," Nixon said. "On day one as Governor, I made it clear that bringing next-generation automotive production to Missouri would be a top priority for my administration."
Under the contract, instead of annual raises, most Ford workers will get profit-sharing checks. Workers will also get around $7,000 in inflation protection and lump-sum payments over the life of the contract, the UAW said.
Ford also plans to add 5,750 U.S. factory jobs under the deal, on top of 6,250 it announced earlier this year, for a total of 12,000 jobs by 2015, and it pledged to invest $4.8 billion in its U.S. factories, including the $1 billion at the Claycomo plant.
A woman who answered the phone at the UAW local union hall in Kansas City referred all calls about the contract to the UAW leadership in Detroit.
Missouri Sen. Chuck Purgason, a Republican who opposed the 2010 Missouri tax breaks for Ford, said Tuesday he was not impressed with the contract development.
"I figured they would be here anyway. The tax incentives weren't the thing that made them stay," Purgason said. "This is just an example of large corporations that have large lobbying firms usually getting the tax breaks, while every small business across the state is left to fend on its own."