Ford Motor Co. and Mazda Motor Co. will lay off about 945 employees, or 31 percent of the work force, at their jointly owned plant because of slow sales of the Mercury Cougar and Mazda 626 coupes.
The plant in Flat Rock, Mich., known as AutoAlliance International will eliminate its second shift in July, said Ford spokeswoman Cheryl Eberwein. About 875 hourly workers and 70 salaried workers would be laid off, she said, but those numbers could change before July. The plant has 2,843 hourly and salaried workers.
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Eberwein said the move was being made to reduce inventories of the Cougar and 626, which have lost sales even as the industry enjoys a banner year. Sales of the Cougar are off 32 percent through April of this year, while sales of the 626 are down 12 percent, despite a rebate of up to $2,000.
Ford had a 105-day supply of Cougars at the end of April, according to Ward’s Automotive Reports; 60 days is the industry standard. Mazda had a 55-day supply of 626s.
The plant built 78,000 Cougars and 87,000 626s last year. Eberwein could not say how much output would be cut, but did say production speed would be increased on the first shift.
Eberwein said many of the workers would likely be offered transfers to other Ford plants in the next several months.
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By GlobalDataUnder standard United Auto Workers union contracts, workers who are laid off due to slow vehicle sales receive nearly full pay for up to 42 weeks. Messages seeking comment from local union officials were not immediately returned.
