US: Ford North American automotive operations to take US$1bn restructuring charge
Ford has said in that it expects its North American car operations to make a pretax loss this year, reported Dow Jones.
The company made the statement in its 2005 annual report filed with the Securities and Exchange Commission. It said it expects to take a pretax US$1bn restructuring charge in 2006, and return to profitability no later than 2008.
The pre-tax charge includes $250m for hourly personnel reductions and a primarily non-cash charge of $250m for fixed asset write-offs.
According to Reuters, the filing also acknowledged for the first time that bankruptcy by a major competitor, or General Motors in particular, could damage Ford's business by disrupting its supply base and undercutting it on wages.