Henry Ford was labor's best friend and worst enemy.
From paying factory workers an unheard of $5 a day in 1914 to his violent opposition to the UAW in the 1930s, Ford shaped labor's progress in 20th century America.
Ford Motor Co. fought legally and illegally to keep the UAW from organizing its factory workers. It was the last of the Big 3 to sign a union contract, holding out for four years after the UAW had organized General Motors and Chrysler Corp.
But once Ford Motor capitulated to the UAW in 1941, the paradox that was Henry Ford reasserted itself: Ford Motor signed the most progressive union contract by a major company in American industry.
Ford Motor went from the worst labor relations in the auto business to the undisputed best by the 1980s and 1990s. The cooperation gave Ford numerous advantages over its competitors during those decades.
Now the direction Ford will take with the UAW is again in limbo. As the two parties face contract negotiations this summer, Ford is trying to turn around its troubled business, and the UAW is attempting to hang on to jobs and benefits. The outcome will shape the future of Ford Motor and the UAW for years.
In the early years of Ford Motor, Henry Ford helped working men and women. Among his contributions: a shorter workday, employee bonuses and health care. But with the moving assembly line, craftsmanship abated and turnover grew.
In January 1914, Ford rocked the industrial world by more than doubling the wage of Ford factory workers to $5 a day. The change vastly improved their standard of living and served as a powerful publicity tool for Ford.
But during the Depression in the 1930s, wages were slashed, thousands of workers lost their jobs, and Ford gained a reputation as the enemy of the working man. In 1932, marchers desperate for jobs and better working conditions were attacked by Dearborn police and Ford security forces at the gates of the Rouge plant; four demonstrators were shot dead.
By early 1937, after sit-down strikes had paralyzed production, GM and Chrysler recognized the UAW. Ford was the final and most difficult target.
Henry Ford hated unions, and he gave Harry Bennett, chief of Ford Motor's notorious Service Department, the task of stopping the UAW. Bennett stocked his private police force with ex-convicts and gangsters.
"It was very, very evident that Henry Ford had made a decision that he would take them on, and he meant violence," says Irving Bluestone, a former UAW vice president and retired Wayne State University professor.
That became clear on May 26, 1937, at the massive Rouge plant. Union activists, led by UAW Vice President Richard Frankensteen and Walter Reuther, an ex-Ford toolmaker who later became the UAW's president, gathered at an overpass near Gate 4 of the Rouge to pass out leaflets.
They weren't alone. Dozens of women joined them in demonstrating, and many reporters and photographers were present. As the group watched, Bennett's men approached and ordered the activists to leave. Before the UAW men could leave, Bennett's men attacked.
They beat the activists bloody. Photographers recorded the event, and press coverage alerted the nation to Ford's union-busting tactics. The Battle of the Overpass made the cover of Time magazine, and led to National Labor Relations Board charges against Ford. The company lost that challenge after appealing to the U.S. Supreme Court.
Still, it would be four more years until Ford Motor was unionized. The firing of eight men at the Rouge on April 2, 1941, was the turning point. About 50,000 Rouge workers joined a wildcat strike.
Harry Bennett (in bow tie), who spearheaded Ford Motor's anti-union actifities, signs Ford's first contract with the UAW in 1941. PHOTO: From the Collections of The Henry Ford and Ford Motor Co.
After his militant opposition to the UAW, Henry Ford unexpectedly gave the UAW almost everything it wanted during contract negotiations. The most shocking: a closed shop and union dues collected by the company. Some say Henry Ford thought he could control the UAW; others say he thought the union would destroy itself through infighting.
Regardless, it was the most momentous win in organized labor's history. The UAW had been far from secure in its position at GM and Chrysler, but the Ford win cemented the union's standing and the case for union labor throughout industry.
"It was a watershed in American history," says Steve Babson, a labor historian at Wayne State University in Detroit.
The best of times
Ford Motor and the UAW would set more standards in years to come. Henry Ford II, who became president in 1945, created a meaningful relationship with the union.
Walter Reuther's brother, Victor, an early UAW activist, saw the transformation.
"Whenever the union wanted just money, it would put the screws on General Motors," Reuther told Ford biographer Robert Lacey in 1985. "But when it came to points of principle - the first guaranteed pension, supplemental unemployment benefits - it always went to Ford first."
The parties had their squabbles, but by the early 1980s the relationship had gelled.
"It was the best union-company relationship not only in the auto industry but anywhere in American industry," says Sean McAlinden, a labor economist with the Center for Automotive Research in Ann Arbor, Mich. "It was unbroken. Ford always delivered new products to plants that delivered improvement."
Observers credit Ford's Peter Pestillo and the UAW's Steve Yokich for forging the friendly atmosphere. The relationship became a competitive advantage, and employee involvement thrived.
"It kind of brought the two (sides) together and said, 'We need to improve our quality; we need to be more efficient in our manufacturing and our productivity; we need to work together to try to fend off the imports,' " says Jerry Sullivan, president of the influential Local 600 at the Rouge.
During the late 20th century, Ford outpaced domestic competitors in quality and in productivity, as measured by the Harbour Report, a highly respected industry guide. GM took a more confrontational approach, and UAW members went on strike 24 times between 1994 and 1998, costing the world's largest automaker up to $7 billion in earnings, McAlinden estimates. During the same time, Ford had no strikes and enjoyed labor peace.
Showdown in 1999
But peace wasn't lasting. In 1999, Ford's plan to spin off its parts operation as a separate company dubbed Visteon Corp. caused the most serious strife between Ford and the UAW in decades. The union, which had battled GM over its similar Delphi Corp. spinoff, came within hours of walking picket lines.
"Ford never had a national strike since 1976," recalls Bob Marcin, current Visteon senior vice president of corporate relations and Ford's chief bargainer in the 1999 contract talks. "Imagine the pressure I had in '99 when they were ready to walk out on us. It was very, very difficult not to have a strike."
Ford made an 11th-hour offer to extend lifelong employment to workers in Visteon plants in exchange for the spinoff. The UAW agreed, though tensions remained.
The standoff shattered Ford and the UAW's 15-year record of the best labor relations in any industry, McAlinden says.
As of 1999, Ford hadn't shut down a plant in 18 years, hadn't reduced its labor force in 14 years, and hadn't suffered a national strike in 23 years, he says. But since 1999, GM has surpassed Ford in productivity, quality and the use of cooperative labor-management teams. And 2003 is shaping up to be another watershed year.
"The relationships are still very solid, but the competition still looms," Sullivan says. "The economy, of course, is in a situation where it is adversely affecting Ford plants throughout the system."
Ford, after losses totaling nearly $6.5 billion the past two years, has said it wants to shut five North American plants. It will need the cooperation of the UAW, given existing job guarantees and moratoriums on plant closings.
CEO Bill Ford has said he will take a significant role in the 2003 negotiations as he tries to turn around the company founded by his great-grandfather 100 years ago.
Says Visteon's Marcin: "There's an awful lot of uncertainty on all three sides - Visteon, Ford and the UAW. But there is clearly an acknowledgment that there is going to be a very difficult set of issues for this negotiation for Ford and Visteon."