Ford to Cut More Than 3,000 Jobs
Ford Motor Co. will eliminate 1,700 contract workers, 1,300 vacant salaried positions and 50 salaried employees in North America by the end of the year, the automaker said Tuesday.
The news came on the same day United Auto Workers members at Ford and supplier Visteon Corp. ratified a four-year labor contract covering 93,000 hourly workers and 105,000 retirees and their spouses.
The cutbacks are linked to Ford’s announcement in July that it hoped to cut 10% of costs associated with its salaried automotive workforce by the end of 2003, Ford spokesman Oscar Suris said.
Jim Padilla, president of Ford North America, notified workers of the latest measures in an internal memo Tuesday.
Suris declined to say whether the 3,050 reductions would allow the automaker to reach its 10% goal or whether further cuts were needed.
“This is an objective we’re seeking to achieve by year’s end,” he said.
The 1,700 contract employees who will lose their jobs work for outside staffing agencies.
In another cost-cutting move, Ford’s German division said Monday that it planned to trim about 1,700 jobs, or 65% of its workforce, also by year’s end -- a decision that comes after a large second-quarter loss for the automaker’s European arm.
Ford-Werke hopes to shed about 700 administrative posts and 1,000 blue-collar jobs by offering a voluntary retirement and compensation package, Ford spokesman Wolfgang Riecker said.
Riecker cited the company’s financial difficulties, along with the “extremely difficult competitive situation,” as reasons for the decision.
The world’s second-largest automaker is in the middle of an aggressive restructuring plan launched in January 2002 that includes a goal of improving profit by $9 billion by mid-decade.
Ford lost $6.4 billion in 2001 and 2002 but earned $1.3 billion in the first half of 2003. The company reports third-quarter earnings Oct. 16.
Ford has about 79,000 salaried automotive workers worldwide.
In trading Tuesday on the New York Stock Exchange, Ford shares fell 16 cents to $10.77.
