Ford to shed another 9,000 plant jobs
Over 2006 and 2007, Ford lost $15.3 billion. Over that same time and in light of those losses, the company also shed 33,600 union workers through buyouts and early retirement. Still working through the uphill part of the turnaround, Ford has announced it wants to eliminate another 8,000 to 9,000 factory jobs through buyouts. If 8,000 workers end up leaving, that's almost 12 percent of Ford's current workforce walking out the door. They'll leave with benefits and a buyout that ranges from $50,000 to $70,000 depending on whether the position is a skilled trade. While it might seem like a lot of money, the point is that with the new labor agreement, Ford can hire new workers -- when the time comes -- for $26 to $31, instead of the $60-per-hour it pays now. The UAW figures the salary change could save Ford $1,000 per car.
Although 8,000 buyouts is Ford's target, the company is willing to accept more workers leaving. The offer has been extended to workers at four shuttered factories, and will be expanded next week to others. Those who don't want buyouts can be transferred to another factory. And if they don't accept the buyout or relocation, then they "will be placed on a 'no-pay, no-benefit leave,'" which sounds a lot less appealing than a 5-figure check.
[Source: Bloomberg]
Reader Comments (Page 1 of 1)
Chad 2:16PM (2/11/2008)
Dang
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Playdrv4me 2:18PM (2/11/2008)
This is one Ford strategy I have no problem with. Unionized labor rates continue to be a thorn in the side of these lumbering behemoths while for the non-unionized plants, it's simply a non issue.
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Maestro1 2:19PM (2/11/2008)
Damn $60 per hour? No wonder the big three are/were going down the toilet!
$60 an hour plus benefits and unions are complaining...that's just unreasonable.
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TriShield 2:27PM (2/11/2008)
This is why American automakers can't make a profit on compact cars assembled in the US. It's also why they make razor-thin margins on everything else besides trucks.
Ford's marketshare doesn't support a huge corporate operation with so many plants anymore either. Ford absolutely must slim down to become profitable in their new reality and continue counting on falling marketshare.
The same goes for Chrysler and GM.
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caddy dave 2:39PM (2/11/2008)
It's $60 per hour INCLUDING benefits.
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Talisman 2:46PM (2/11/2008)
No ASSEMBLY LINE worker deserves 60/hr (even if that is including benefits). Thats just out of control
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pg150 3:06PM (2/11/2008)
People that say line workers don't deserve this morning, never worked the job. You pencil pushers wouldn't last a day.
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Gregg 3:43PM (2/11/2008)
That is not the point and you know it. Other assembly and industrial jobs, no matter how dificult or dangerous, rarely have parity with American auto workers. Would that we could all afford to pay everyone what they think they are worth. But it is either bring wages to a more realistic level, or lose the few remaining American manufacturers.
Furthermore, there are plenty of pencil pushers who have difficult jobs as well. Jobs which require college degrees and pay less than $20/hour. Would you care to be a child abuse investigator, for example, where you have to go into people's homes and workplaces to find out whether they are treating their kids right? Not exactly the welcome wagon.
Big Rocket 3:44PM (2/11/2008)
pg150: You mean, pencil pushers as opposed to button pushers? I have been to several domestic manufacturing facilities near Detroit, and in every one I visited, they had push-button machinery for manual labor from heavy lifting down to screwing in the nuts and bolts. It is *not* the back-breaking work the UAW would like the public to believe. Don't believe me? See for yourself here in the links below:
Hydraulic lifts in use: http://www.autoblog.com/2007/03/01/do-you-think-that-the-chrysler-employeess-buyout-offer-was-fair/
Pneumatic power tools in use: http://www.autoblog.com/2007/05/15/jeep-employees-pissed-about-chrysler-sale-use-photo-71730996-f/
$60/hr (including benefits) to push buttons all day long? A sweet deal if you work for the UAW, a rotten deal if you are the car buyer paying the extra $1000 per car, and downright suicide if you are an automaker struggling to regain market share.
LMBVette 3:36PM (2/11/2008)
For $60 per hour, I'm sure most of us "pencil pushers" could certainly last much longer than a day. Especially considering those of us on here are car nuts and would love to build cars for a living.
In my previous life, I was a Physical Therapist and during my internship (in Toledo, Ohio) I treated a guy who worked for Jeep for repetitive use injury. He was 50'ish. Back in 1997 he told me his base was 50k per year plus semi-annual or quarterly bonuses which were 10-20k each. I thought that was insane money and I questioned why I was even bothering with getting a college degree.
Well, fast forward 11 years later, and even with a Master's in the IT field, that line worker putting doors on a Jeep still makes more than I do today counting all his bonuses.
So, I'm 100% certain I could last on a line for $60 per hour. Unfortunately, when the labor unions drive up the prices, manufacturers will go elsewhere to build their products. Free economics. However, we all know the Big 3 were locked into paying 25-50% more per worker, which killed their profits and severly affected their products.
While I feel bad for those who are no longer making the money they used to, you need to realize that you had things very, very good for a long, long time. The primary concern of a corporation is it's own survival, not yours. Cuts are necessary and the workers need to learn new skills. I wish those who lost their jobs good luck in finding new ones and learning new skills.
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Atropos 3:51PM (2/11/2008)
Everyone loves 'globalization' until they realize they're next on the chopping block.
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Big Rocket 4:50PM (2/11/2008)
And everyone loves protectionism until they see nice cars overseas not available for sale at home. Cough - Ford Focus - cough.
s2000 11:23AM (2/12/2008)
another bad new for big 3.
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John 6:52AM (2/12/2008)
$60.00 per hour? To me the UAW has outlived its usefulness. There was a time the union was needed. But, now American car companies can build they'r product for much less, it has been proven, ie, Toyota and Hyundai.
The UAW, along with some other mistakes, has almost runined GM, Chrysler and Ford. GM is on the way back, the book has yet to be written on Ford and Chrysler.
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