American carmaker Ford has decided to take drastic action as it prepares for dramatic losses in Europe – in the region of $1.5billion.
With vehicle demand having slumped by 20 per cent in Western Europe since 2007, Ford has announced several plant closures: it will close its vehicle assembly plant in Southampton, which currently builds the Ford Transit (pictured); its stamping and tooling operations in Dagenham; as well as its plant in Genk, Belgium.
According to Ford, the measures will reduce vehicle assembly capacity by 18 per cent – around 355,000 units – and will yield savings on an annual basis of $450-$500million. When added to the 500 salaried and agency positions that will go voluntarily as part of a previously announced initiative, a total of 6,200 jobs will be affected: around 13 per cent of Ford’s total European workforce. This includes 4,300 jobs in Belgium and 1,400 jobs in the UK.
Ford suggests that the employee reductions in the UK will be achieved voluntarily, as well as through redeployment to other Ford locations and through enhanced employment separation programmes.
Furthermore, with new vehicle sales having reached a 20year low in the region this year, Ford has decided to move production of its Mondeo, S-MAX and Galaxy vehicles from the Genk plant to Valencia, Spain. Depending on the results of a further study, it is also expected that production of the C-MAX and Grand C-MAX will move from Valencia to Saarlouis, Germany. Meanwhile, the manufacturing of the Ford Transit will be consolidated with its operations in Kocaelia, Turkey – with the Southampton plant to close in 2013.
There was some good news for Ford UK however, as it outlined plans to remain a centre of excellence for powertrain development and production. This will include adding a next-generation, low CO2 2.0litre diesel engine to the Dagenham plant. This engine is set to power Ford vehicles from 2016 onwards and safeguards thousands of jobs.
The moves come just one month after Ford announced aggressive product plans for the region to include: the introduction of 15 global vehicles in Europe within five years; a new Fiesta to be redesigned inside and out and offer CO2 emissions below 100g/km; a new Ford Mondeo to feature the award-winning 1.0litre EcoBoost engine; and the expansion of the SUV segment including an all-new Ford Kuga and the introduction of the Ford EcoSport and Ford Edge in the region.
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