Ford Motor (NYSE:F) has negotiated a tentative deal with the Canadian labor union Unifor, effectively averting the looming threat of a second strike. This comes after the Canadian union workers threatened to strike to address their demands for more pay and benefits. Negotiations with Unifor have been occurring concurrently with discussions in the U.S. involving the UAW (United Auto Workers) union.
The specifics of the agreement, which encompasses about 5,600 members employed at Ford’s Canadian facility, remain undisclosed.
Meanwhile, in the ongoing developments, talks between the UAW and Ford have extended into this week without reaching any resolution. Last week, the UAW initiated strikes at one facility of each of the three major Detroit automakers: Ford, General Motors (NYSE:GM), and Stellantis (NYSE:STLA), leading to production disruptions. Moreover, the UAW has threatened to expand the strikes to additional factories if significant headway is not achieved in the negotiations by noon on Friday.
Irrespective of the final outcome, these negotiations will likely increase the labor cost for the three automakers, posing challenges for these companies as they transition toward EVs (Electric Vehicles). With this background, let’s look at what the Street recommends for the shares of Ford Motor.
Is Ford a Buy, Sell, or Hold Stock?
Ford Motor recently emphasized that its labor expenses significantly exceed those of Tesla (NASDAQ:TSLA) and other automakers that employ non-unionized labor forces. This presents a formidable challenge for Ford and other automakers like GM and Stellantis as they navigate the initial phases of transitioning from internal combustion engines (ICE) to electric vehicles while attempting to compete effectively with Tesla.
Given the challenges, Wall Street analysts are cautiously optimistic about Ford stock. It has received seven Buy, eight Hold, and one Sell recommendations for a Moderate Buy consensus rating. Analysts’ average price target of $15.53 implies 23.65% upside potential from current levels.