# Ford Reinstates 2023 Guidance After Labor Strikes
## Impact of Labor Strikes
New York – Ford Motor on Thursday reinstated its 2023 guidance after pulling its forecast last month due to the impacts of labor strikes and negotiations with the United Auto Workers union.
The guidance calls for $10 billion to $10.5 billion in adjusted earnings before interest and taxes, or EBIT, and adjusted free cash flow of between $5 billion and $5.5 billion. This compares to its previously announced guidance of adjusted-EBIT of between $11 billion and $12 billion and adjusted free cash flow of $6.5 billion to $7 billion.
## UAW Labor Agreement Costs
The new UAW labor agreement is expected to cost $8.8 billion over the life of the contract, which expires in April 2028. Crosstown rival General Motors on Wednesday reported a $9.3 billion impact over the length of the agreement.
## Impact on Ford’s Earnings
Ford’s Chief Financial Officer John Lawler said on October 26 that prior to the UAW strikes, Ford was “poised” to hit its guidance. However, the UAW strike had already cost the company $1.3 billion in earnings due to lost production of about 80,000 vehicles, including roughly $100 million during the third quarter. On Thursday, the company updated that impact amount to $1.7 billion, including $1.6 billion in the fourth quarter.
## Future Costs and Investments
The UAW deal is expected to add about $900 in costs per assembled vehicle by 2028. As a result, Ford plans to cancel or postpone $12 billion in investments related to electric vehicles.
“We’ve got a highly talented team that allocates capital with great discipline, so that we’re executing with consistency, generating strong growth and profitability, and are less cyclical,” Lawler said in a statement Thursday, citing the company’s Ford+ turnaround plan.
## Further Actions
Ford plans to discuss the reinstated guidance at a Barclays investor conference on Thursday morning. This update comes a day after GM said it planned to increase its quarterly dividend next year by 33% to 12 cents per share; initiate an accelerated $10 billion share repurchase program; and reinstate its 2023 guidance to include an estimated $1.1 billion in earnings before interest and tax, or EBIT-adjusted, impact from the UAW strikes.
## UAW Agreements
Both UAW agreements include at least 25% hourly pay raises, the reinstatement of cost-of-living adjustments and enhanced profit-sharing payments, among other benefits.
Chrysler parent Stellantis, which was the second of the so-called “Big Three” U.S. automakers to reach a deal with the UAW, has not disclosed expected costs of its labor pact with the union.
In conclusion, Ford Motor has made strides to overcome the impact of UAW labor strikes and reinstated its 2023 guidance, aligning itself with its competitors in the automotive industry.
I have been featured in numerous publications, both online and offline, and am a regular speaker at industry events. I am also the founder of Crypto University, an online educational platform that helps people learn about cryptocurrencies and blockchain technology. In addition to my writing and teaching career, I am also an active investor in the cryptocurrency space. I have made investments in some of the leading projects in the space, and my portfolio has outperformed the market by a wide margin