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. Last Updated: 07/27/2016

Ford Plant Dispute Threatens Output

Workers at Ford's car-assembly plant near St. Petersburg have threatened a work-to-rule starting Feb. 14 unless the company's management signs a collective bargaining contract with them.

The dispute could threaten production at the plant, which last year helped Ford almost double its sales in Russia.

The labor union of 1,300 employees is demanding a comprehensive contract from the company for 2007 that will fix salary levels and increments, standard working shifts, labor protection and social guarantees.

Union leaders say the demands are standard practice in large corporations and are intended to bring the contracts in line with Russian labor codes, Kommersant reported Saturday.

The union registered its grievances with the office for labor disputes settlement last month but could not get a conciliation committee to resolve the dispute, the newspaper reported.

Alexei Etmanov, the union leader at Ford's Vsevolozhsk factory in the Leningrad region, said management was backpedaling on earlier promises to enter into a collective bargaining contract for this year.

"Negotiations on the collective contract broke down after three months. We could not come to agreement on a single point within that period," Etmanov said, the Institute for Collective Action reported on its web site.

The work-to-rule would be the third such action in two years.

A weeklong go-slow in 2005 hit output of the factory's Ford Focus models and cost Ford $3.6 million in potential revenue, prompting the company to import cars from its European plants, Kommersant reported.

Against the backdrop of sliding sales in the United States, Ford's sales in Russia rose by 92 percent last year, making it the country's leading foreign carmaker.

Ford sold 124,500 cars in Russia last year, up from 60,100 cars in 2005.

The Vsevolozhsk plant assembled 62,400 Ford Focus models, an 89 percent increase on 2005. The increase helped maintain the Focus as the best-selling non-Russian brand in the market for a fourth year running.

Ford plans to increase sales by 30 percent in 2007 and increase production its Vsevolozhsk plant 20 percent to 75,000 vehicles, Ford's Russia vice president Sergei Bogdanov said, Interfax reported Jan. 19.

The Vsevolozhsk plant was the first fully foreign-owned car plant in Russia when it opened in July 2002.

Since then, high demand coupled with cheap labor costs have attracted other carmakers, including General Motors, Renault and Volkswagen, to set up assembly plants in the country.