Ford might eliminate as many as 9,000 more US factory jobs through its latest buyout offers, sources have told a news agency.
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According to Bloomberg News, the cuts would be on top of the 33,600 union workers who left through buyouts and early retirements in 2006 and 2007, when Ford lost a combined $US15.3bn. Further reductions may help Ford restore profit by speeding the hiring of new workers who would be paid about half as much as current staff under a new deal inked last year with the key United Auto Workers (UAW) union.
“These are realistic numbers,” Harley Shaiken, a labour professor at the University of California at Berkeley, told Bloomberg. “Workers are reassessing their options. It is a very tough choice.”
The news agency’s source said Ford doesn’t have an estimate of how many workers would accept the buyouts, proposed to a first group of workers last month, and won’t limit the number who leave if more than the target range of 8,000 to 9,000 opt for the offers.
Marcey Evans, a Ford spokeswoman, declined to comment to Bloomberg News and UAW spokesman Roger Kerson didn’t return telephone messages. Bloom noted that the Detroit Free Press, citing sources, reported on 9 February that Ford had an internal target of 8,000, a reduction that would represent more than 12% of its North American factory workers.
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By GlobalDataThe report said Ford’s employment fell to 64,000 at the end of last year at North American plants from 99,500 two years earlier.
The UAW deal agreed in November permits the automaker to pay lower wages for new hires while keeping open five factories targeted for closure. Under the four-year agreement, Ford can pay up to 20% of its US factory workers the reduced wage, the news agency noted.
Under the accord, Ford’s hourly costs for new workers would be $26 to $31, or about half the $60 cost of a current UAW member’s wages and benefits.
But, before new, lower-paid workers can be hired, Ford must resolve the fate of workers at closed factories and at its Automotive Components Holdings unit, which includes factories Ford took back from former parts subsidiary Visteon. Most of those plants are being closed or sold, and some of the UAW-represented employees may go to Ford plants, Bloomberg News said.
