Ford Tells UAW They Have 4000 More Workers Than It Needs

By Brendan Moore

09.11.2008

Ford has informed the UAW (United Auto Workers) union that due to crashing sales, and despite recent employee buyout efforts, Ford is 4000 workers over what they need in order to satisfy current demand, according to Reuters. The statement was made during confidential meetings between workers and Ford earlier this week, as disclosed by the Reuters source.

Ford has been on a push to eliminate hourly employees through buyouts the last 24 months, but the pace of departures has slowed considerably lately as the overall job market worsens in the U.S. and potential buyout candidates fear being unemployed for a long time if they accept a buyout from Ford.

Ford has lost a stunning amount of money in last two years and desperately needs to better match production capacity to sales, and part of that production capacity is the worker population required to make the vehicles. Ford lost another $8.7 billion USD last quarter.

High gasoline prices, the housing sector implosion, the slumping overall economy in the U.S. and tighter consumer credit have been killing sales of all the auto manufacturers, but Ford has been hit particularly hard. The timing couldn’t be worse as Ford is trying to tear the company apart and rebuild it in order to position itself to compete more effectively in the new automotive world order that higher gas prices and much tighter emissions controls promise. Somewhat ominously, it now looks as if the rest of world may also be entering a period of slowing economic growth, which could mean that Ford can no longer count on its international operations to continue to pick up the slack from the ailing North American market.

Ford has cut approximately 40,000 workers from its North American payroll since the end of 2005, which leaves it with around 60,000 workers currently. Ford is the second-largest auto manufacturer in North America behind GM.

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Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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