Ford (F) -) shares moved higher in pre-market trading after the carmaker reached a tentative labor agreement with the United Autoworkers Union that includes $8 billion in new manufacturing investment and a 30% pay increase for full-time employees.
Ford's agreement, which must be ratified by UAW members before taking effect, will see workers getting a $70,000 pay boost over the life of the new four and a half year contract, with higher wages for temporary workers and the elimination of pay tiers.
Ford will also include new battery and EV plants into the agreement, with investment commitments of around $8 billion.
The UAW also reached a tentative agreement with Stellantis (STLA) -) and its 43,000 unionized workers following forty days of strike action against the Jeep maker and Chrysler brand owner.
President Joe Biden called the Stellantis deal "a testament to the power of unions and collective bargaining to build strong middle-class jobs"
UAW president Shawn Fain, however, called for new strike action against General Motors (GM) -) over the weekend, citing its "unnecessary and irresponsible refusal to come to a fair agreement.”
The UAW added a plant in Spring Hill, Tennessee to the list of three facilities already hit by walkouts, after failing to reach an agreement in the wake of the Ford breakthrough.
Thew new action takes the level of GM's U.S. production affected by disruption past the 50% mark, leaving it vulnerable to higher costs linked to the dispute after warning earlier this month the strikes were costing it around $200 million a week.
Both Ford and GM pulled their full-year profit forecasts last week, citing the impact of the UAW strikes and the corresponding hit to labor costs an agreement is likely to incur.
Ford also said the ongoing EV price war is eating into its overall profits, with the division posting a third quarter loss of $1.33 billion.
GM, meanwhile, scrapped its goal of making 400,000 electrified vehicles between 2022 and mid-2024, a target CEO Mary Barra was committed to as recently as July of this year.
Ford shares, which shed more than $4.3 billion in value during the duration of the UAW strikes, were marked 0.9% higher in pre-market trading to indicate an opening bell price of $10.05 each. GM shares, meanwhile, edged 0.3% higher to $27.30 each and Stellanti was marked 0.13% lower in Milan.
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