Ford Motor Co., the first US automaker to reach a mid-contract union agreement, said labor concessions will save about $375 million this year and allow consolidation of vehicle assembly between two Michigan factories.

The automaker said contract changes ratified by the United Auto Workers union on March 9 permit the use of stock to pay as much as $6.5 billion to a Voluntary Employee Beneficiary Association retiree health-care fund.

Ford will halt assembly of the Ford Focus small car at a Wayne, Michigan, factory and shift production to an adjacent plant.

Ford said it will save $250 million by ending cost-of-living adjustments and employee bonuses.