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post #1 of 5 (permalink) Old 01-11-02, 08:22 AM Thread Starter
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Ford cutting 35,000 jobs!!!

NEW YORK (CNN/Money) - Ford Motor Co. will cut 22,000 jobs in North America and 13,000 elsewhere in coming years as the No. 2 automaker struggles to cut costs and boost profits, President Nick Scheele said at a news conference Friday.

Ford will close five plants, slash U.S. auto production and take $4.1 billion in charges as part of the plan. In addition, Ford cut its dividend for the second time in a year and CEO William Clay Ford said at the news conference that he would take no salary or bonus this year.

Ford has been struggling with industry overcapacity, restrictive labor contracts and an industry incentive war that has attracted buyers but helped cause rising losses at the company. The company's involvement in the Firestone tire recall has also raised questions about quality.

Wall Street has been expecting a broad restructuring plan for weeks after Ford said it would unveil one this month. Ford has cut jobs and idled or slowed production at several plants in the interim as its profits continued to slide.

Ford already has ended matching contributions to its salaried staff's 401(k) retirement plans as well as increasing health insurance premiums.

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post #2 of 5 (permalink) Old 01-11-02, 09:30 AM
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That's only half of what's happening.

In a very brief summary for the moment:

Low-margin models to be discontinued by 2002 (not many surprises):

Mercury/Ford Cougar,
Mercury Villager,
Lincoln Continental,
Ford Escort.

Plant Closures:

Edison Assembly,
Ontario Truck Plant,
St. Louis Assembly,
Cleveland Aluminium Casting,
Vulcan Forge.
Further downsizing and shift reductions for further 11 plants.

50% dividend reduction,
7% pay reduction to contract labour firms,
Elimination of bonuses and raises for senior managers,
Sharing of health care costs between employee/employer,
Non core assets will be sold.

All this activity does not mean that Ford are not committed to product development with an investment of US $20 billion allocated for the next five years in product development.

No information was given regarding Ford Australia and its role in the restructure...fingers crossed for the long-term future of Ford Australia.

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post #3 of 5 (permalink) Old 01-11-02, 11:37 AM
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selling of hertz is meant to be a consideration as well
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post #4 of 5 (permalink) Old 01-11-02, 12:43 PM
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post #5 of 5 (permalink) Old 01-11-02, 12:53 PM
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All of those changes (Villager, Cougar, Continental, Escort) have been expected, no surprises there. And, as for the plant closings, again...all expected. These aren't surprises.

Edison is giving way to Ranger production consolidation.

Ontario Truck is closing and the F-Series production will move to another plant.

St. Louis is a partial surprise...but with Explorer sales down, they can consolidate into Louisville.

Avon Lake will partially close when the Villager/Quest leave.
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