Thread: Ford Cuts At Least 25,000 Jobs

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Ford Cuts At Least 25,000 Jobs

UPDATED: 8:48 am PST January 23, 2006

DETROIT -- Ford Motor Co., the nation's second-largest automaker, said Monday that it will cut 25,000 to 30,000 jobs and idle 14 facilities by 2012 as part of a restructuring designed to reverse a $1.6 billion loss last year in its North American operations.

The cuts represent 20 percent to 25 percent of Ford's North American work force of 122,000 people. Ford has approximately 87,000 hourly workers and 35,000 salaried workers in the region.

Ford shares rose 68 cents, or 8.6 percent, to $8.58 in morning trading on the New York Stock Exchange.

Earlier Monday, Ford reported earnings of $2 billion in 2005, down 42 percent from last year's profit of $3.5 billion. It was the third straight year the automaker has reported a profit, but gains in Europe, Asia and elsewhere were offset by a loss of $1.6 billion in North American operations.

Plants to be idled through 2008 include the St. Louis, Atlanta and Michigan's Wixom assembly plants and Batavia Transmission in Ohio. Windsor Casting in Ontario also will be idled, as was previously announced following contract negotiations with the Canadian Auto Workers. Two other assembly plants to be idled will be determined later this year, the company said.

The other seven facilities that will be idled were not immediately identified.

A total of 14 facilities, including seven assembly plants, will cease production by 2012, Ford said.

"We will be making painful sacrifices to protect Ford's heritage and secure our future," Chairman and Chief Executive Bill Ford said in a statement. "Going forward, we will be able to deliver more innovative products, better returns for our shareholders and stability in the communities where we operate."

The No. 2 U.S. automaker after General Motors Corp. has been hurt by falling sales of its profitable sport utility vehicles, growing health care and materials costs and labor contracts that have limited its ability to close plants and cut jobs. The United Auto Workers union will have to agree to some of the changes Ford wants to make.

Ford also has seen its U.S. market share slide as a result of increasing competition from foreign rivals. The company suffered its tenth straight year of market share losses in the United States in 2005, and for the first time in 19 years, Ford lost its crown as America's best-selling brand to GM's Chevrolet. Ford sold around 2.9 million vehicles for a market share of 17.4 percent in 2005, down from 18.3 percent the year before and 24 percent in 1990.

Ford said Monday it would no longer provide earnings guidance beginning in 2006.

"We must be guided by our long-term goals of building our brands, satisfying customers, developing strong products, accelerating innovation, and, most importantly, producing a sustainable profit from our automotive business," the CEO said.

The restructuring is Ford's second in four years. Under the first plan, Ford closed five plants and cut 35,000 jobs, but its North American operations failed to turn around.

Alan Hallman, mayor of Hapeville, Ga., where the Atlanta Assembly Plant is located, called the latest news "a setback for the state."

The plant, which makes the Taurus, has about 2,000 employees. Hallman said it accounts for 9 percent of the small city's budget.

"We've got hundreds of man-hours and thousands of dollars invested on various plans to keep them here. The fact that they've elected to idle the plant is very disappointing," he said.

Ford used just 79 percent of its North American plant capacity in 2005, down from 86 percent in 2004, according to preliminary numbers released last week by Harbour Consulting Inc., a firm that measures plant productivity. By contrast, rival Toyota Motor Corp. was operating at full capacity.

Ford said in its earnings announcement Monday that it reduced employment in 2005 by 10,000 people due to layoffs, buyouts and attrition. Ford has around 300,000 employees worldwide.

I really feel for the workers. I am so sorry to hear about there bad news. But as far as Ford Motor Company, with who they support. I say, we can find a better make of Car anyway. At least one that maybe not as big of a traitor as Ford is.

Does anyone know if they're closing any plants in Mexico?

Will Ford also be cutting donations to LaRaza and MALDEF? These two groups are largely responsible for the higher health care costs Ford cites.

Just a little funny thing. I just recieved a Voucher from Ford, backed by Wells Fargo. Oh yeah I really would take that offer.

I can envision a time in the future when the winds of war blow across the planet.

So many possible scenarios:

The Islamic countries combine force, use their enormous wealth to buy and/or build factories to produce the engines of war: tanks by the thousands, aircraft, ships.... on and on.

Or, China builds and build...... perhaps cooperating with Indonesia, maybe India... who knows.

The end result is a formidable war machine. Backed by nukes? China and India have them. So do others such as Pakistan.

The nuclear deterrence may be present.

The cabal goes upon a war of aggression. Invade Japan? A new Greater Eas Asia Co-prosperity sphere? A new grab for territory encompassing a large part of a continent?

A direct attack against the USA is unlikely due to the logistics involved but, who knows what the future holds?

Still, as in WW 2, the American elites may decide that full-scale conventional war is needed to stop an attack here or elsewhere.

The call to industrial America will go out. But, the response will be minimal. Not enough factories to build our own massive war machine. The possibility of being able to import steel etc. from foreign sources may be denied due to enemy anti-shipping activity (sinking cargo ships with subs and surface ships, land-based anti-ship missiles at shipping choke-points, missiles from aircraft.

Without an industrial infrastructure we may have to allow agressors to do what they want or..... we may be forced into a "nuclear option."

The ramifications of that could result in rataliation and/or such hatred towards the USA by the rest of the world we will never be secure again.

Also, since our politicians refuse any attempts to wean ourselves from foreign oil dependence (gotta' keep the profits HIGH for those favored corporations) it is likely an enemy could shut down oil imports from, at least, the middle east, but also, possibly, from other foreign sources. Also, the Alaskan pipeline is an easy target.

The lack of oil will ground our minimal war machine quickly after hostilities commence.

Yes, corporate America and ye government of for and by the elite class and your buddies, gut America's industrial capacity so as to leave us a mere eunuch, unable to defend ourselves in a full-scale "world war" and force us to one option.... nuke or not to nuke.

All the while, the quality of life of the masses continues to plummet.

It is NOT the end, my friends, But, sadly, I believe that NOW, we are witnessing the beginning of the end.

Do not fear!!!!!! I rest easy knowing America's wealthy powerful elite class will do well, living a grand lifestyle. Us mere commoners will merely join our bretheren who have, throughout history, lived marginalized lives while our labors support the elites in fine style. (note scarcasm in this paragraph).

This is top news story, as it should be.

Bottom line - If a layoff is an internal American problem - Newsworthy
If a layoff benefits foreign nationals - News Reporters' Code of Silence!

Conspicuously absent from the mainstream news are those layoffs (in either the thousands or tens of thousands) primarly in the IT industry where another country benefits. Examples: When Carly (no American has a God given right to a job) Fiorina orchestrated the big layoffs at HP, the computer press and India Times announced those layoffs, but the mainstream press remained silent. Other examples include mass layoffs at IBM, Microsoft, and others not making the mainstream news.

Why? Because the mainstream press itself offshores to Bangalore, India. These are the layoffs where Americans are coerced into training their replacements from Bangalore, India just before being fired.

Likewise....

Layoffs where Americans are fired and replaced by Illegal Aliens from Mexico don't make the mainstream news - because the mainstream news reporters aren't doing their jobs.

Do News reporters ever read this website? Huh? If I'm wrong, tell me I'm wrong. I want to be wrong. C'mon reporters, join this website, log in, and tell me how shamefully wrong I am.

Disclaimer: I do not represent this website or any of its members. I'm just reporting the news

January 23, 20006, 3:10pm EST
FORD TO CUT UP TO 30,000 JOBS

Ford Motor Co., America's second largest automaker, announced restructuring plans Monday that will cut 25,000 to 30,000 jobs and idle 14 plants by 2012.
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The plans, dubbed the Way Forward, were announced by William Clay Ford Jr., the company's chairman and CEO and grandson of company founder -- Henry Ford.

Ford hopes the plans will reverse losses in the North American auto operations and return the division to profitability by 2008.

"We will be making painful sacrifices to protect Ford's heritage and secure our future," Ford said in a statement.

The cuts represent nearly a quarter of Ford's North American workforce of 122,000 people. Ford also said it was reducing the company's salaried workers by 12 percent by the end of the first quarter. The company has 87,000 hourly workers and 35,000 salaried workers.

The company did not release a complete list of plant closings, but plants that are expected to be idled through 2008 include assembly plants in St. Louis, Atlanta and Wixom, Mich., as well as plants in Batavia, Ohio, and Windsor, Ontario Canada. Two more assembly plants are expected to be added to the list of plants to be idled by the end of the year, according to the Associated Press.

This is the second time in four years that Ford has restructured its North American auto division. Analysts criticized the first plan as too tepid. Under that plan, the company closed five plants and cut 35,000 jobs, but the cuts failed to turn the operations around.

Wall Street's response to Monday's announcement was more positive. Ford shares rose, 60 cents, or 7.6 percent, to $8.50 in midday trading on the New York Stock Exchange.

Response in communities where cuts are planned were not as upbeat. Alan Hallman, mayor of Hapeville, Ga., described the news as "a setback for the state." He said the Atlanta assembly plant accounts for 9 percent of his city's budget.

Although Ford Motor Co. has reported a profit for three straight years. Gains in Europe and Asia were offset by a loss of $1.6 billion in North American operations. Ford's U.S. operations have been hurt by decreased sales of sport utility vehicles, increased health care and materials costs, increased competition and labor contracts that limit plant closures and job cuts.

Mark Fields, Ford's executive vice president, described the Way Forward plan as an effort to retake the American marketplace by focusing on the consumer, changing the company's conservative business culture and adopting a "change or die" mentality.

-- Compiled from wire reports and other media sources

http://www.pbs.org/newshour/updates/ford_01-23-06.html

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http://www.ford.com/en/company/corporat ... ontact.htm

I'll check with them and see how many plants in Mexico they are closing or if they are just screwing over mostly American Workers.

http://www.nytimes.com/2006/01/24/autom ... ?th&emc=th

January 24, 2006
Ford Eliminating Up to 30,000 Jobs and 14 Factories
By MICHELINE MAYNARD
DEARBORN, Mich., Jan. 23 - The Ford Motor Company said Monday that it would close as many as 14 factories and cut up to 30,000 jobs over the next six years. It was the latest move in a fundamental restructuring of Detroit's traditional auto companies, hit hard by foreign competitors, who have taken more than 40 percent of the American market.

The moves by Ford, the second-largest automaker in the United States, come two months after General Motors, the industry leader, said it would close all or part of a dozen factories and eliminate a similar number of jobs.

Including cuts that took place at the Chrysler Corporation, the Big Three automakers have eliminated or announced plans to eliminate nearly 140,000 jobs since 2000, including salaried positions. That is about one-third of their North American payroll, a rollback to a work force size not seen since the end of World War II. "This may not be the end, but it is certainly the beginning of the end of the automobile industry as we knew it," said Gary N. Chaison, a professor of industrial relations at Clark University in Worcester, Mass.

While the Big Three are visibly shrinking, their combined moves do not spell the end of automotive manufacturing in the United States. But the geographic footprint has largely shifted south, where a new auto industry is flourishing.

Japanese, German and South Korean companies now employ 60,000 people, or about the same number by which Ford and G.M. have said they will shrink. But foreign makers are creating a younger, cheaper work force, sidestepping Detroit's unemployed and the higher pay and benefits packages that Detroit workers were getting.

The United Automobile Workers union, which represents workers in the United States, said the announcement by Ford was "deeply disappointing and devastating" for its members. The cutbacks signal a new reality for auto workers - one in which $30-an-hour wages and generous benefits are no longer a guarantee.

Ford's share price closed up 42 cents, at $8.32, on the New York Stock Exchange.

The cuts at Ford are taking place under a turnaround plan it is calling the Way Forward, marking its second attempt to revamp the company in the last four years. Ford's goal is to become as nimble as Toyota and Honda, cutting through layers of bureaucracy that have stymied the development of innovative vehicles like hybrid electric cars. It also highlights Ford's American roots and aims to create clearer identities for its Ford, Lincoln and Mercury brands.

Rising gas and steel prices and strong competition from abroad have intensified the challenge to Ford and G.M., already burdened by rising health care costs and a legacy of promising rich pension packages and other retirement benefits. More important, both companies have failed to find the right formulas to satisfy the American car buyer.

The result has been a swift slide in market share. Ford, which held about 25 percent of the car market in 2000, held only 17.4 percent in 2005. Much of the drop is a result of the decline in popularity of big sport utilities, which fueled profits and market share at Ford during the 1990's, when it had about 100,000 hourly workers.

Monday's cuts at Ford affect about a third of its hourly payroll in North America, where it has 87,000 workers. The company is also cutting another 4,000 salaried employees, or about 10 percent of its white-collar force, and has pledged to reduce its executive ranks by 12 percent.

Foreign manufacturers, who now sell more than 4 of every 10 cars and trucks in the United States, have created tens of thousands of jobs at new factories from Ontario to Ohio, across the South and in Mexico.

Because of their growth, there has been no net loss in American automotive jobs over the last 10 years, according to James P. Womack, an author and specialist in manufacturing efficiency. Auto industry employment has held steady at about 1.1 million workers, including those at parts companies, he said.

In fact, those foreign companies, which collectively employed about 60,000 workers at the North American plants last year, are expanding their factories. Later this year, Toyota will open a new truck plant in San Antonio, and it is building another factory in Ontario.

Earlier this month, Nissan's chief executive, Carlos Ghosn, who became a management model for leading his company's successful turnaround during the last six years, said Nissan might expand its two-year-old factory in Canton, Miss.

While foreign automakers have hired some former Detroit workers, most of their workers have no automotive experience and were chosen through rigorous screening processes that stress physical endurance and a bent for working in teams.

With a smaller market share, Ford has its plants in North America operating at only three-quarters capacity, sparking the company's decision Monday to close assembly plants in Wixom, Mich., outside Detroit; Hapeville, Ga., outside Atlanta; and Hazelwood, Mo., a suburb of St. Louis.

Two more assembly plants will close, Ford said, although it did not name them. The auto company is also shutting a transmission plant in Batavia, Ohio, near Cincinnati, and analysts said they expected that other Ford parts plants would also shut once the company decided which assembly plants to close.

Ford is also cutting one shift of workers at its plant in St. Thomas, Ontario, two hours west of Toronto.

Ford's chief executive, William Clay Ford Jr., called the cuts "a painful last resort." But he said the company's plan contained "the vision and strategic focus to rebuild the business."

"With it," Mr. Ford said, "we will retake the American roadway."

Mr. Ford, who unveiled the earlier transformation program in 2002, shortly after he installed himself as chief executive, said that plan had achieved its goals but was not enough in the face of stiff foreign competition.

"We will not stand for business as usual," Mr. Ford said.

But Ford held out hope for some workers, saying that it planned to create a new factory somewhere in North America to build small cars at a low cost. Ford executives declined to say when the plant would be built - or whether it planned to employ unionized workers in the United States or Canada.

The idea seemed an echo of G.M.'s original intent with the Saturn Corporation, whose plant in Spring Hill, Tenn., was meant to prove that American workers could build cars that could compete with Japanese autos.

In fact, Saturn's vehicles lured buyers away from Toyota and Honda in the early 1990's, when the cars were first on sale. But Saturn cars subsequently declined in popularity after G.M. decided to focus more attention on developing S.U.V.'s.

And although G.M. is trying to rejuvenate Saturn, it announced last year that it would close an assembly line at Spring Hill, placing the plant's long-term future in doubt.

Ford's announcement of the Way Forward plan on Monday ended weeks of speculation that it would eliminate some product lines. But on Monday, Ford declined to comment on specific vehicles.

Shortly before it outlined the program on Monday, Ford said it lost $1 billion before taxes on its automotive operations in 2005, up from an $850 million loss in 2004. It posted a full-year profit of $2 billion, down from $3.5 billion in 2004, but its third consecutive annual profit. It has managed to keep making money across the board because of good results overseas and the strength of its financial services division.

But in December, Standard & Poor's Ratings Services cut its rating on Ford's debt two notches deeper into junk, just as S.& P. did at G.M. after it unveiled its reorganizing plan.

S.& P. warned that Ford was particularly vulnerable to steps that G.M. might take to improve its market share, like the steep employee discounts it offered consumers last summer. But the ratings agency, which warned that G.M. could be forced to restructure under Chapter 11 protection, said it was not concerned that Ford would have to do so.

One reason, analysts said, is that the Ford family, which controls the company through a special class of stock, would do everything to prevent such a move.

On Monday, Mr. Ford's cousins, Edsel B. Ford II and Elena Ford, looked on as Mr. Ford invoked his great-grandfather, Henry Ford, in an effort to encourage Ford employees to be more innovative.

Mr. Ford recalled that Henry Ford built his first car in a shed behind his Detroit house, only to realize it was too big to get out the door. Instead, Mr. Ford said, his great-grandfather knocked down a wall to drive it out.

"We intend to remind people every day that if you want to build something that's never been built before, you may have to knock down a wall or two," Mr. Ford said.

But Wall Street was looking to Mr. Ford for more specifics than the company provided in an hourlong presentation. Ford officials, in fact, said the automaker would no longer issue annual earnings guidance to analysts - a sharp departure from Ford's past practice of stating its goals in advance.

Indeed, the company said Monday only that it expected to be profitable on its automotive operations in 2008, meaning it would lose money on them this year and next.

Mark Fields, recently named president of Ford's operations for the Americas, who was the author of the Way Forward plan, also said that Ford meant to stabilize its declining market share, and eventually gain sales. But he did not say when that would happen or what share of the American market Ford eventually expected to hold.

Ford's refusal to give more details on its plant closing plans and financial targets was a contrast to the clearly defined outline at Nissan by Mr. Ghosn, the Renault executive who took over the company in 1999.

Nissan either met or exceeded the goals in three programs outlined by Mr. Ghosn, who vowed six years ago to resign if the company could not achieve its targets.

On Monday, Mr. Fields said in an interview that he was approaching his job "as if my job is on the line."

"Hopefully, if we're successful," Mr. Fields added, "I'll share in the rewards, and if not, I'll share in the ramifications."