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Ford Motor Co. (F) said it will lower wages and narrow the pay gap with its foreign competitors under a new United Auto Workers agreement.

The move comes as General Motors Corp. (GM) and Chrysler LLC (C.XX) are seeking similar wage reductions as a condition to meet requirements to access more federal low-interest loans. The UAW has agreed to some GM and Chrysler concession but the sides are still at odds over retiree health care funding issues.

Ford said its hourly wage, including benefits, will now be about $55 an hour compared with the $48 paid by foreign auto makers operating in the U.S., said Ford's Group Vice President of Global Manufacturing Joe Hinrichs. UAW members ratified the wage changes and other cost-cutting initiative Monday.

As part of the accord, Ford will begin a new company-wide buyout program on April 1. The offers will be lower than previous programs because of the economy, Hinrichs said without providing further details. The offer will end May 22.

Hinrichs also confirmed that Ford will end production at its Wayne, Mich. plant, home to the Ford Focus. Focus production will be moved next door to the Michigan assembly plant which is being re-tooled to produce smaller vehicles. The plant had assembled the Ford Expedition and Lincoln Navigator sport-utility vehicles. The "consolidation" will not result in any job losses.

Ford said last year that it was converting the plant in an effort to produce more small cars in the U.S. as consumers moved away from buying SUVs and pickup trucks.

Ford shares increased 7% or 13 cents to $1.98 in earlier trading Wednesday.

-By Jeff Bennett, Dow Jones Newswires; (248) 204-5542; jeff.bennett@dowjones.com