Car Maker Expects to Make a Loss of More than $1.5 billion in Region This Year
By MARIETTA CAUCHI And MIKE RAMSEY
Ford Motor Co. F +2.16% outlined a broad plan to stem its operating losses in Europe by closing three auto-assembly and parts factories, trimming 13% of its workforce and 18% of its new-car production capacity in the region.
The restructuring aims to return Ford's money-losing European operations to profitability by mid-decade amid a sharp decline in new-car sales across Europe that is not expected to be reversed soon. The moves will reduce its operating costs by $500 million in the next two years.
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Topical Press Agency/Getty ImagesFord will end 100 years of building cars in England. Workers leaving a plant in Dagenham, U.K., in 1937.
The factory closings include a Southampton plant that produced 28,000 vans last year, a tool operations and stamping plant at Dagenham, both in the U.K., and its large Genk, Belgium, plant that built 178,000 vehicles in 2011. The workforce reductions include 5,700 hourly and salaried workers at the three plants and another 500 salaried employees across Europe who are expected to accept buyout offers by year-end.
The auto maker has projected a loss of $1.5 billion in Europe this year and a similar loss in 2013.
The closures are to take place by summer 2013, and will end the U.S. auto maker's long history of vehicle manufacturing in the U.K. The company will continue to build engines and transmissions in the country. Ford produced its first car in the U.K. in 1911.
Ford is retaining a diesel-engine production plant at Dagenham and its petrol engine production plant at Bridgend. It will also keep its transmission-making joint venture with Getrag at Halewood. Ford of Europe CEO Stephen Odell said the company would invest £1.5 billion ($2.41 billion) in the Dagenham engine plant to make next-generation diesels.http://online.wsj.com/article/SB10001424052970203897404578078360301276102.html
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