Automaker’s restructuring plan likely will include massive job cuts, plant closures
Patricia Platt, an employee at the Dearborn Truck Plant, looks over the new 2006 Lincoln Mark LT pickup in Dearborn, Mich., on Jan. 31, 2005. The Associated Press
September 15, 2006
DETROIT – Ford Motor Co. will offer buyout and early retirement plans to all of its hourly U.S. employees – more than 75,000 of them – as part of a broad restructuring plan aimed at cutting its costs in light of slumping sales.
Ford had about 82,000 workers represented by the United Auto Workers at the end of last year, but about 6,500 have taken previous buyout and early retirement offers made mainly at plants slated for closure, company spokeswoman Marcey Evans said Thursday.
The news came a day before the nation’s second biggest automaker was to reveal details of a restructuring plan that likely will include massive job cuts and additional plant closures.
The buybacks are aimed at helping Ford cut costs as its sales shrink under fierce competition from more fuel-efficient models from Asian automakers.
The UAW announced the proposal in a statement to its members Thursday, saying that the offers are available to all active Ford workers represented by the union.
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“Once again, our members are stepping up to make hard choices under difficult circumstances,” UAW President Ron Gettelfinger said in a statement. “Now, it’s Ford Motor Co.’s responsibility to lead this company in a positive direction – which means using the skills, experience and dedication to quality that UAW members demonstrate every day in order to deliver quality vehicles to customers.”
The buyouts are part of a larger restructuring plan approved by the Ford board of directors during a two-day meeting that ended Thursday. Ford said Thursday that it would announce details of the new plan Friday morning.
Ford shares fell 10 cents to close at $9.09 on the New York Stock Exchange. Its shares have traded in a 52-week range of $6.06 to $10.09.
Ford has been battered by the auto market’s shift from trucks and sport utility vehicles to more fuel-efficient cars and crossovers. Its market share and sales have dropped while its Japanese competitors have gained.
Under the plan, detailed in a UAW statement, workers can choose between eight packages that offer from $35,000 to $140,000 depending on various factors.
“I think it’s a good package,” said Chris Kimmons, president of UAW Local 919 at the Norfolk, Va., assembly plant.
Depending on which plan is chosen, workers may have to give up health benefits.
