Ford Unveils European Output Cuts

Jobs will stay

Ford said on March 16 that it would cut European production in light of slumping demand, but would avoid outright firings. Ford would adapt output in Germany, Romania and Spain "to the unprecedented decline in the European new car market and the continuing negative economic outlook," a statement said.

Last month, Ford's European sales fell by almost 12% from February 2007 to just under 89,000 vehicles, according to data provided by the European Automobile Manufacturers' Association (ACEA).

The group's plant in Valencia, Spain would therefore operate with two shifts instead of three, and a factory in Saarlouis, southwestern Germany would implement a 20-day pause that had already been announced, the company said.

In Cologne, western Germany, another Ford plant would continue full production however to meet demand sparked by a government subsidy that has boosted sales of smaller cars such as the Fiesta and Fusion models. The Cologne plant "will share with Ford's Craiova (Romania) engine plant the production of a new, small-displacement EcoBoost advanced petrol engine," the statement added.

Ford is bound by an agreement with German unions to maintain jobs at their current level until 2011, it said. The U.S. group employs around 70,000 people in Europe, where it operates 22 factories.

Ford's rival, General Motors, may fire up to 3,500 workers at Opel and Vauxhall factories in Europe, however.

Talks are ongoing with unions and public authorities to search for ways of securing 3.3 billion euros (US$4.3 billion) in public aid that GM says it needs to keep European plants running.

Copyright Agence France-Presse, 2009

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