Ford of Europe is emphasising capacity utilisation as one of the prime drivers behind its decision today (25 October) to close its Transit plant at Southampton, UK.
The move – along with the announcement it will also shutter its stamping and tooling operations at the Dagenham complex – will cost around 1,400 jobs although UK unions are predicting far higher eventual knock-on redundancies in the supply chain.
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“[It is] a principle of capacity utilisation,” Ford of Europe CEO, Stephen Odell, said on a conference call to media and analysts today. “Southampton is around 28,000 – it is clear Kocaeli [the Ford-Otosan joint venture Turkish plant where most Transit and Transit Connect production will now be consolidated] can build any of the commercial vehicles we need – it was not to do with labour rates or wages.
“It is significantly lower cost to build and deliver [even] with duties to a Turkish service anywhere in Europe than to build Transit in Southampton.”
Odell, who insisted Ford would “very much like to make sure” all the UK redundancies were voluntary, maintained the automaker had a “social responsibility” not only to the people losing their jobs but also to the Southampton area as well.
“Despite what people may think, I am a human being and I know this affects families,” he said.
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By GlobalData“We have to remind ourselves we are not responsible for the economic situation we find ourselves in but we have to make sure we are viable and profitable.
“In the end, it is the right thing for the business.”
Production of Ford’s completely redesigned ‘full-size’ Transit and new, compact Tourneo Custom van models started in Kocaeli last summer with the automaker saying it was the first step in a transformation of its global commercial vehicle range by the end of 2013.
An even larger variant, comparable with the largest Mercedes Sprinter, Nissan’s NV400, the Ford E-series it replaces and other domestic rivals will be sold in the US from 2013.
The Transit Custom sits between the smaller Transit Connect, also made in Turkey, and the larger Transit van in Ford’s commercial vehicle line-up and is also made as an eight- or nine-seat people-mover, the Tourneo Custom.
Turkey’s Ford Otosan is jointly owned by Ford and Koc Holdings. Kocaeli has built Transits since 2001 and, to date, has made more than 2,250,000 vehicles and exported them to more than 70 countries.
Southampton has built the European Transit since 1972 (the first generation was launched in 1965) and currently makes 28,000 a year. In September 2008, Ford said it would halve output and would continue making the Transit panel van only until 2011. After that the plant would switch to just the specialist chassis-cab variant.
That move ultimately reduced output from 75,000 units a year to 35,000 and followed the termination of 124 short-term contracts at the plant the previous month.
