Dolphan
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Ford set to shed 20,000 jobs and shut plants
By Tim Burt and Nikki Tait in Detroit
Published: January 6 2002 20:55 | Last Updated: January 6 2002 22:25
The board of Ford Motor Company will this week approve a wide-ranging US restructuring expected to involve up to 20,000 job losses, the closure of plants and aggressive capacity cutbacks.
A special board meeting has been convened, and the restructuring measures will be unveiled on Friday.
It is understood that at least 8,000 white collar jobs could be shed - 20 per cent of the total - while up to 12,000 hourly workers could be encouraged to take early retirement or voluntary severance packages.
The move marks the culmination of a six-month strategic review led by Nick Scheele, who was promoted to chief operating officer following the removal of Jac Nasser as Ford chief executive in October.
Mr Nasser's departure cleared the way for Bill Ford, great-grandson of founder Henry Ford, to become chairman and chief executive with a mandate to unveil the overhaul of Ford's US operations.
Ford is thought to be seeking savings of $3bn-$5bn to rebuild profitability in its core North American market, the minimum Wall Street views as essential if the company is to remain competitive with foreign automakers.
Ford has warned that it will make a loss of around 50 cents a share, or about $900m, in the fourth quarter. That will leave the group with a deficit of about $1.3bn for the year - although additional charges to cover the restructuring could make the loss much higher.
Ford has already announced plans for single-shift output at its Edison plant in New Jersey, and other plants thought to be at risk include its Ontario plant in Canada, and facilities in Atlanta and St Louis.
The overhaul is likely to involve a shake-up in Ford's powertrain operations. The company could also farm out more engine development to Mazda, its Japanese affiliate.
By Tim Burt and Nikki Tait in Detroit
Published: January 6 2002 20:55 | Last Updated: January 6 2002 22:25
The board of Ford Motor Company will this week approve a wide-ranging US restructuring expected to involve up to 20,000 job losses, the closure of plants and aggressive capacity cutbacks.
A special board meeting has been convened, and the restructuring measures will be unveiled on Friday.
It is understood that at least 8,000 white collar jobs could be shed - 20 per cent of the total - while up to 12,000 hourly workers could be encouraged to take early retirement or voluntary severance packages.
The move marks the culmination of a six-month strategic review led by Nick Scheele, who was promoted to chief operating officer following the removal of Jac Nasser as Ford chief executive in October.
Mr Nasser's departure cleared the way for Bill Ford, great-grandson of founder Henry Ford, to become chairman and chief executive with a mandate to unveil the overhaul of Ford's US operations.
Ford is thought to be seeking savings of $3bn-$5bn to rebuild profitability in its core North American market, the minimum Wall Street views as essential if the company is to remain competitive with foreign automakers.
Ford has warned that it will make a loss of around 50 cents a share, or about $900m, in the fourth quarter. That will leave the group with a deficit of about $1.3bn for the year - although additional charges to cover the restructuring could make the loss much higher.
Ford has already announced plans for single-shift output at its Edison plant in New Jersey, and other plants thought to be at risk include its Ontario plant in Canada, and facilities in Atlanta and St Louis.
The overhaul is likely to involve a shake-up in Ford's powertrain operations. The company could also farm out more engine development to Mazda, its Japanese affiliate.
