38,000 Ford Workers To Take Buyouts

Nov. 29, 2006
Union workers, including those at ACH division accept buyout.

Ford Motor Co. said Nov. 29 some 38,000 unionized workers had accepted voluntary buyouts, marking a key step in the restructuring plan. The figure includes 30,000 buyout offers in a recently concluded offer for Ford hourly workers, including those at the company's Automotive Components Holdings (ACH) division. About 8,000 were accepted earlier this year.

Ford began the year with about 83,000 employees represented by the United Auto Workers, and hopes to reduce this number in an effort to return to profitability.

"One of Ford's priorities, and a large cost component of our Way Forward plan for North America, is our ability to adjust manufacturing capacity with demand, while continuing to reduce operating costs and becoming more efficient," said Alan Mulally, Ford president and chief executive. "While I know that in many cases decisions to leave the company were difficult for our employees, the acceptances received through this voluntary effort will help Ford to become more competitive."

Analyst Himanshu Patel at JP Morgan Securities said the development raises "the possibility of (North American) profitability in 2008," noting that it could reduce some of Ford's massive pension liabilities. Ford's latest revised figures showed it lost $5.2 billion in the third quarter and seven billion dollars so far this year.

Ford's losses this year include heavy provisions for its hard-hitting restructuring plan, which foresees 16 plant closures in North America.

On September 15, Ford announced its intention to reduce its North American hourly workforce by 25,000 to 30,000 employees by the end of 2008, including attrition and excluding employment reductions at ACH.

Copyright Agence France-Presse, 2006

About the Author

Agence France-Presse

Copyright Agence France-Presse, 2002-2024. AFP text, photos, graphics and logos shall not be reproduced, published, broadcast, rewritten for broadcast or publication or redistributed directly or indirectly in any medium. AFP shall not be held liable for any delays, inaccuracies, errors or omissions in any AFP content, or for any actions taken in consequence.

Sponsored Recommendations

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!