AVON LAKE — Ford Motor Co. will invest $128 million in the Ohio Assembly Plant to add production of medium-duty trucks and motor home chassis to the plant under the terms of a proposed new contract between the automaker and the United Auto Workers.

The E-Series van, which Ford plans to phase out by 2014, is now the sole product line being built at the plant, which sits in portions of Avon Lake, Sheffield Lake and Sheffield. The medium-duty trucks are now manufactured in Mexico, while the motor home chassis is built in Detroit.

Ohio Assembly, which has roughly 1,700 hourly workers and 100 management employees, is currently on a two-week shutdown.

The proposed contract, which would last through 2015, still needs to win approval from Ford’s approximately 41,000 union members across the nation.

Nick Gallogly, a former union leader at Ohio Assembly who now works as a national UAW representative, said the proposed contract would be a boon to workers and the local economy.

“It’s great that Ohio Assembly is getting the $128 million investment and job retention,” Gallogly said.

He said Ford had promised to introduce a new line to the plant under the terms of the last contract, which was ratified in 2007. The company renewed that promise in 2009 when it sought and received concessions from the union, but exactly what the new line would be wasn’t made public until Tuesday.

Gallogly said he was glad to see Ford keep its promise to bring a new product to the plant.

“It’s finally come together,” he said.

Ford and UAW officials declined to discuss whether the investment will mean new jobs at Ohio Assembly.

Ford spokeswoman Marcey Evans said the company has committed to hiring 12,000 new workers through 2015 under the terms of the contract. About half of those new workers will be on the job by the end of 2012. The only specifics Ford has given so far is that about 1,800 workers will be hired at the company’s Louisville, Ky., plant, she said.

Evans also declined to discuss when the improvements would take place in Avon Lake. In total, Ford announced it would invest $16 billion into its U.S. operations over the next four years, about $6.2 billion of which will be dedicated to upgrading the company’s plants.

Mixed reviews

Brian Penson of Amherst, who’s worked at the plant for six years, said from what he’s seen of the contract so far, he plans to vote in favor of it. He said he was excited by the prospect of a $128 million upgrade to the facility and believes it will mean more jobs at the plant.

“It all seems like it would be a good idea,” he said.

Despite his enthusiasm for the investment, Penson said there’s some skepticism among the plant’s workforce that Ford will follow through on the investment. He said the company promised a new product line four years ago and it’s only delivering now.

Other Ohio Assembly workers, who asked that their names not be used, bluntly said they would vote against the proposed contract.

One worker, who’s been at the plant for nearly 24 years, said given the quality of the vans built at the plant, the assumption was that the Transit, which is seen as the replacement for the E-Series vans, would be manufactured in Avon Lake.

But the UAW said the Transit will instead go to Ford’s Kansas City Assembly Plant, which will see an investment of more than $1 billion from the automaker.

“We didn’t really get the reward, we got the pacification prize,” the worker said.

He also said executives and management have continued to receive bonuses in the millions of dollars, while the signing bonus for veteran workers is only $6,000. Ford workers with less than one year of service would get a $5,000 bonus if the contract is approved.

Another veteran worker, who’s been at the plant for 15 years, said he, too, plans to vote against the contract because it doesn’t go far enough to restore benefits union members have given up in recent years as Ford struggled to deal with the recession. And while workers hired after September 2007 will see their pay increase over the life of the contract, older workers won’t get a raise, he said.

“We’ve been left holding the bag, and we’re the ones building the vehicles they’re selling,” he said.

Under the terms of the contract, instead of cost-of-living pay increases, workers would get $1,500 annually to offset the rising cost of getting by. Longtime production workers would receive a $50,000 incentive if they retired, while skilled trade workers would be paid a $100,000 incentive to leave the company.

A third worker, who’s been at the plant for 23 years, said he doesn’t plan to vote for the contract because he doesn’t believe Ford is investing enough in Ohio Assembly’s future.

Officials pleased

Local officials, however, praised the new contract and the $128 million investment.

“It’s good for workers, it’s good for the economy and it’s good for Sheffield Village,” said Sheffield Mayor John Hunter, a retired Ford worker who once served as union president.

Lorain County Commissioner Lori Kokoski said the investment shows that Ford is committed to maintaining a presence in Avon Lake.

“They continue to invest money in the plant and I hope they stick around for a long, long time,” she said.

There’s also the possibility that Ford will receive tax breaks and other incentives from both state and local governments to help facilitate the upgrade to the plant, state Sen. Gayle Manning, R-North Ridgeville, and Avon Lake Mayor Karl “K.C.” Zuber said.

The Ohio Department of Development referred questions about a possible incentive package to the JobsOhio program, but a call to that organization wasn’t returned Tuesday.

Ford received a $75 million incentive package when it began producing the Ford Escape in Avon Lake in 2003, but it moved production of the SUV to another plant only a few years later when it shuttered the Lorain Assembly Plant and consolidated Econoline production at Ohio Assembly.

State Rep. Matt Lundy, D-Elyria, said that although he’s not directly involved in drafting an incentive plan, he expects that there will be one, particularly since Avon Lake relies on the Ford workers to fill the city’s coffers through income taxes.
It was that way back when he was an Avon Lake city councilman in the 1990s.

“It was kind of every day you were walking on eggshells wondering about the future of the plant,” he said.

Tuesday’s announcement tells him, he said, that Ford remains committed to Ohio Assembly, something he credits to the plant’s workers and the vehicles they produce.

“You can provide all the incentives you want, but if the workers aren’t building the quality product, the company isn’t going to make the investment,” Lundy said.

Highlights of the proposed contract

• Ford workers will get at least $16,700 over the four-year contract in the form of a $6,000 signing bonus, $7,000 in lump-sum and inflation protection payments and at least $3,700 in profit-sharing this year. That’s more generous than GM’s agreement, which guarantees workers at least $11,500.
• Ford 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. It also pledged to invest $4.8 billion in its U.S. factories. When combined with $1.4 billion in investments previously announced, Ford plans to invest $6.2 billion by 2015.
• If they agree to the contract, Ford’s 41,000 hourly workers will get $1,000 more as a signing bonus than the $5,000 bonus GM workers got. The GM deal also gives most workers profit-sharing payments instead of annual raises and promises 6,400 new or retained jobs.

Contact Brad Dicken at 329-7147 or bdicken@chroniclet.com.