Ford to Cut 600 Jobs in Spain

Sales declining in Spain and rest of Europe

Ford told unions on July 31 it plans to cut 600 jobs from its plant in eastern Spain due to weakening demand.

The company said it would go from "three to two production shifts" at the plant at Almussafes, near Valencia. It said the layoffs would be on a voluntary basis.

Ford said it was forced to make the decision by declining sales in Spain and the rest of Europe amid the economic crisis.

Spain's auto manufacturing sector is the third-biggest in Europe and accounts for just under 10% of the country's economic output and 15% of exports.

In 2008, new car sales in Spain plunged 28%, the largest-ever annual decline as the country entered its first recession in 15 years with the global credit crunch worsening a correction already underway in its property sector.

However, the auto sector has shown signs of recovery since the government in May announced a subsidy of 2,000 euros (US$2,700) for motorists wanting to buy a new car.

Copyright Agence France-Presse, 2009

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