Filed under: Trucks/Pickups, Hirings/Firings/Layoffs, Ford
Ford firing letting go up to 12% of salaried workers
Perhaps 'fired' is the wrong word, as that does imply that these white collar workers did something wrong. The only thing some 12% of Ford's salaried workforce did wrong is get hired by a company that dug itself into a hole relying on strong truck and SUV sales during the 1990s. Now, with consumers avoiding gas-hungry vehicles, the restructuring effort faltering amidst high gas prices, and news that the company has abandoned its goal of returning to profitability in 2009... cutting more salaried workers was inevitable.
Ford CEO Alan Mulally told reporters last week that sales of big trucks and SUVs crashed once gas hit $3.50 per gallon. In April, full-sized pickups accounted for 11 percent of sales. By the second week of May, the number had fallen to just 9 percent. "I don't think we've ever seen a decline week over week like this," Mulally said. "It was clear to us it was time to act." And act they did. While details have not been finalized, Ford expects to eliminate up to 12 percent of its salaried work force (with about 24,300 white-collar workers in the States, this means more than 2,000 positions will be gone). Ford Vice President Jim Farley couldn't sugar-coat the news, but he did try to spread the doom around when he spoke to his employees on Friday, saying "I would expect other car companies to make similar announcements... they have the same issues that we do -- even Toyota."
[Source: The Detroit News]
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Reader Comments (Page 1 of 3)
Johnny 1:08PM (5/28/2008)
You know what I think these 24000 people plus the other 45000 that were let go last year should do? They should all come together, pool their resources and start a new car company. They have the talent. Among these 69000 people are engineers, marketing, management, line workers, welders, benders, and everything else that you need. 69000 people walking into a bank and each getting a loan for 20000 grand is 13.8 billion. Thats more than enough to buy some idled plants for dirt cheap and make cars and have their own company. When they make a profit, share the money around.
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Omer 1:17PM (5/28/2008)
do you have any idea what kind of certifications ($$$$$/lobbying) are required to get a car roadworthy in America? there is a reason why there are only less 10 major car companies here.
Albert 1:38PM (5/28/2008)
Omer, first off some of the thousands of ex Big Three employees are the testers and lobbyists and regulationologists. So they know who to call in Washington and where to take the car. What Johnny is saying is that these people have talents and know the industry, they know what to do.
Secondly, getting a car certified is not hard. Tesla and Saleen and Mosler and Shelby and many more do it everyday on a much smaller budget.
Omer 2:23PM (5/28/2008)
I understand what you are saying but my point is talent is not enough to get a car on the road. There is a sh#t load of legal work that required ($$$) to get a mass production car on the road. Also to produce a car that any where near affordable (sub 20K range) you need a factory and good assembly plant so more money. advertisings, marketing and all other department which require huge amount of budgets to run. I am not sure people being laid off in Detroit have that kind of money.
It would better idea if people being laid off spent their resources starting new companies that does contract work for larger companies using union free labor.
Ford Wannup 3:26PM (5/28/2008)
Why is Omer being voted down for being rational? Nevermind something as complex as starting a new car companies, there have been plenty of examples of employees laid off from large, complex, industrial/service companies pooling their talents together to replicate their previous employers, very few of them are successful. A bunch of ex-Eastern airlines employees started Kiwi Airlines, with short initial success, only to succumb due to lack of capital. Are these employees willing to front their own money to start a car company? Will they be able to raise capital in the private/public market? etc.
Omer was right in that it'd be against all odds to start a new car company. The key is to find each one of their own niches and/or other industries, or start their own small businesses that they can grow, to which they can apply their talents.
It's been stated factually many times that generally, most laid off employees ended up in better jobs/careers/business in the long term.
Allen 3:50PM (5/28/2008)
Brilliant idea my friend, but 20,000 grand? if i do my arithmetic right... and... carry the one... thats 20,000,000. (ala Dr. Evil) A lot for an unemployed person to borrow. maybe they can put their town up as collateral.
Nick 5:32PM (5/28/2008)
Do you really think that the people who got LET GO from Ford are the right people to start a new car company? These are the people that weren't sufficiently talented enough to work for a struggling company...
Randy 10:48PM (5/28/2008)
That's a cool idea! But with the average person owing 20K in credit card debt and the average savings being about 40k, that's leave a few million in investment to start a company! That wouldn't buy much at all! It would take about 200 Mil to start! Maybe some VC money?
steveo391 11:16PM (5/28/2008)
I agree that on the surface it seems like a good idea. But maybe they'd be better off to start an oil company?
dpb! 1:13PM (5/28/2008)
Best pic in autoblog ever!
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geo.stewart 1:58PM (5/28/2008)
since autoblog is obviously not familiar with the practice or term, it is called lay-offs and happens frequently in the world and I expect as a result of the economy will be happening more.
Blake 2:07PM (5/28/2008)
I know, right! That pic is classic!
Corey L 3:02PM (5/28/2008)
I lol'ed. The door. Let me show you it. :D
DesiAuto 1:13PM (5/28/2008)
OK, I will tell Ford execs right now that gas prices will hit $7 by or before 2011.
If they act surprised at that time, they need to be fired and fined last 5 years of their salary.
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M 1:22PM (5/28/2008)
I'll bet money that gas prices will have reached $7 / gallon before 2011. We'll be inching towards $8 / gallon by then. Someone somewhere is determined that we - in the U.S. - are going to pay the same prices for gasoline as the Europeans. By the way, does anyone know how much gas costs in Japan and in Austrailia?
MajorGeek 1:29PM (5/28/2008)
Thats too funny. You go teach them Ford execs. LOL.
Daniel 1:32PM (5/28/2008)
For the past few years several people have been urging FoMoCo and the other Big 2.5 to build full plug-in, series electric, BioDiesel Hybrids that get better upwards of 100 mpg. If they did just that, they would now be positioned to make a lot of money in the era of $7 fuel.
And, keep in mind that each of these companies built such cars nearly 15 years ago under the DOE's Program for a New Generation of Vehicles (PNGV).
While these companies deserve to go under (and I am a stock holder) it is very sad that so many good people will loose everything they have worked for over the years.
jg 1:34PM (5/28/2008)
'Someone somewhere is determined that we - in the U.S. - are going to pay the same prices for gasoline as the Europeans.'
Well this was mentioned by quite a few people way back when we were voting two oil men into the White House. At the time I thought those people were just being cynical. Seems they were right. What was teh price of a barrel of oil in 2000? I'm not one for conspiracy theories but this sandwhich has some meat in it.
Dinger 2:26PM (5/28/2008)
@ jg
Oil and gas prices did not start to sky rocket until the Dems took control of Congress 2 years ago.
My "theory" is that as long as Repubs had control the mere possibility of opening up massive US oil reserve to drilling kept things in check. Now that the Dems have control and there is no chance any drilling will be allowed prices have gone crazy... and McCain's kowtowing to the AGW crowd only makes it worse.
Gregg 2:48PM (5/28/2008)
My theory, dinger, is you would rather have dubious ideas--which you call theories (maybe you meant hypothesis or hunch?)--than to simply educate yourself about the issues. BTW a theory is an explanation that has passed every objective test to which it has been subjected.