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Could Healthier Auto Workers Cut The Cost Of Your Next Ford?

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Ford workers build Focus models at the Michigan Assembly Plant. Image: Ford Motor Company

Ford workers build Focus models at the Michigan Assembly Plant. Image: Ford Motor Company

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When we think about the cost of making cars, we think about things like research, design, raw materials, parts, and labor. But there are many other factors that affect the price of our vehicles, and one of those things is healthcare.

Yesterday, Ford released a statement about its new initiatives "to build and maintain a sustainable hourly workforce". That sounds great for Ford employees -- and according to Auto News, it could bring down the price of your next ride. 

A SUSTAINABLE WORKFORCE

Ford's announcement came by way of Jim Tetreault, the company's vice president for manufacturing in North America. Tetreault said that "Through our Sustainable Workforce initiative, we’re taking a new, holistic approach to fostering growth and well-being amongst our workers, and making sure Ford is a great place to build a career over the long-term.”

This "Sustainable Workforce" initiative is really a four-pronged approach to hiring, training, and monitoring Ford employees:

  • High-performance hiring: Ford doesn't just want to fill an open position with someone who looks good on paper, but might not be a good fit in the long-term. According to Tetreault, "Factors associated with motivation – work ethic, conscientiousness and teamwork – are just as important in an effective employee as skills and abilities such as reading, arithmetic, defect spotting and manual assembly. Looking at candidates from both perspectives allows us to better select potential high performers who we want working with us.” 
  • Advanced training: Ford plans to augment training for new employees, ensuring that they're fully prepared to work -- and work safely -- when they hit the assembly lines.
  • Protection and safety: Ford has boosted safety protocols to ensure that activity in its facilities is carried out with caution. That's helped cut injury rates by about 90% over the past 14 years. Given the stress of repetitive movement that auto workers often endure, Ford is also paying more attention to ergonomics, using a "virtual factory" to spot potential problems before they happen in the real world.
  • Health and well-being for life: Ford acknowledges that many of its hourly workers experience problems with asthma, diabetes, and other chronic medical conditions at rates far greater than the general U.S. population. The automaker's new plan will collaborate with the UAW to encourage smart healthcare -- especially preventive screenings -- to keep workers healthier. 

That seems swell for employees, but these aren't mere feel-good initiatives. Ford hopes they'll have a positive impact on the company's bottom line, too.

Ford hasn't assigned a dollar figure to the savings that the "Sustainable Workforce" program might bring, but Tetreault noted that employees with chronic healthcare problems can cost the company ten times as much as healthy employees. And those with some of the most common chronic conditions like asthma, diabetes, and hypertension make up roughly 60 percent of all healthcare costs.

The cost-savings Ford is likely to see, though, probably won't come from reductions in healthcare spending. As numerous studies have shown, increasing access to preventive care doesn't do much to cut the cost of health plans.

Where Ford is likely to benefit, however, is in the productivity and longevity of its workforce. If employees remain healthy for longer, that means that they'll work more and need to be replaced less often, which in turn means that Ford will spend less on training new workers -- and that's where the savings could add up.

That may not bring down the cost of your next vehicle, but it could help Ford keep prices below competitors. That could be reason enough for you to give Ford a second look next time you're cruising the showrooms.

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