Ford of Europe, which lost $US1.1 billion in 2003 and hampered its parent company’s own recovery, is expecting little or no rise in sales and a pre-tax loss of $100 million to $200 million this year, the Wall Street Journal said, citing the division’s chief operating officer Lewis Booth.
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Booth also reportedly said that the unit isn’t even discussing 2005.
Despite the downbeat outlook, Booth reportedly said he doesn’t foresee further cuts beyond a move last fall to eliminate 3,000 jobs at a Belgian plant and added that he hopes to hasten the unit’s decision-making process and add more excitement to its designs.
The WSJ said Ford’s European unit’s unexpected loss was one of the main reasons the carmaker failed last year to move closer to its goal of lifting pre-tax profit to $7 billion a year by the middle of the decade. Amid a bitter price war in the U.S. and increased competition in highly profitable segments such as big pickup trucks and sport-utility vehicles, Ford reported 2003 earnings of $3.2 billion, the WSJ noted.
The report said Booth is also trying to make the organisation nimbler and has, for example, cut the number and length of meetings among top managers, who previously spent a couple of days a week in all-day meetings, while ordering staff to stop agonising over every decision.
