Ford Motor Co. will offer buyout and early retirement plans to its 75,000 hourly U.S. employees as part of a restructuring plan aimed at cutting costs in the face of slumping sales.
The news came a day before the nation’s second-biggest automaker was to reveal details of a restructuring plan that likely will include massive job cuts and additional plant closures.
Word out of Dearborn, Mich., is that the company will announce another 30 percent cut in its white-collar work force, said Charlie Hughes, former head of Mazda and Land Rover and co-author of the new book Branding Iron, a look at the failing U.S. auto industry.
“You’re going to put a lot of people out of business, and that means a reduction of the work force,” Hughes said.
The buybacks were aimed at helping Ford cut costs as its sales shrink under fierce competition from more fuel-efficient models from Asian automakers. Earlier this year, Ford announced it lost $1.4 billion in the first two quarters.
The United Auto Workers union told its members about the plan in a statement after discussions with Ford on the proposal, said Chris Kimmons, president of UAW Local 919 at the Norfolk, Va., assembly plant. The plant is where Ford makes its F-150 pickup and employs about 2,400 workers.
Kimmons said the packages offers $35,000 to $140,000 to workers who leave the company, depending on their years of service and retirement eligibility.
“I think it’s a good package,” he said. “I think they worked real hard on it. They’ve got to do something to help Ford out of this crisis.”
Depending on which plan is chosen, workers may have to give up health benefits, Kimmons said.
Ford had about 82,000 workers represented by the United Auto Workers at the end of last year. About 6,500 of those had taken previous buyout and early retirement offers made mostly to employees at plants slated for closure, company spokeswoman Marcey Evans said.
Ford is the country’s No. 2 automaker, behind General Motors.
The Associated Press contributed to this report.
