Back to Home PageWelcome Guest! Register | Login | Home | Contact Us | Site Map | Advertise | FAQ | Search
Canadian Desi
    Charcha


        
  Canada Immigration Forum > About Canada > Jobs > Ford to cut one-third of work force
Last Post | Newest Post
 
< [ 1 ] >

Ford to cut one-third of work force




http://news.yahoo.com/s/nm/20060915/bs_nm/autos_ford_dc_13

DETROIT (Reuters) - Ford Motor Co. (NYSE:F - news) said on Friday it will slash $5 billion in costs and one-third of its work force as it warned its auto business would not make a profit in North America for another three years.

The automaker also ruled out an immediate sale of its Jaguar brand, disappointing investors who wanted Ford to press ahead with asset sales to raise cash.

Ford shares dropped as much as 15 percent Friday, the biggest single-day percentage decline in almost four years.

Ford also suspended its dividend and pledged to revamp its vehicle line-up, an area of weakness widely cited by analysts.

In its third turnaround plan in five years, the No. 2 U.S. automaker said it would close 16 North American factories by 2012, two more than originally scheduled.

Ford said it will cut 10,000 white-collar jobs on top of the 4,000 jobs already cut this year. All of Ford's 75,000 factory workers are being offered buyouts under a deal with the United Auto Workers union. Ford hopes to cut 30,000 factory jobs by 2008.

The steps were the latest sign of the financial stress on the traditional Big Three.

General Motors Corp. (NYSE:GM - news) is on track to shutter 12 plants and cut $9 billion in recurring costs as part of its turnaround plan.

DaimlerChrysler AG's (DCXGn.DE) (NYSE:DCX - news) Chrysler Group said Friday it could lose about $1.27 billion this year, a much deeper loss than it forecast in July because of mounting inventory and slower truck and SUV sales.

Ford warned its North American operations would not post a full-year profit before 2009, a year later than first projected. It also targeted $6 billion in materials cost savings by 2010 by streamlining purchasing.

But other steps urged by Wall Street were notably missing from the plan. Analysts questioned whether new Chief Executive Alan Mulally will have to make deeper cuts down the road.

\"The plan does not address the tremendous losses at Jaguar or asset sales. It does not materially accelerate product introductions ... It does not cut capacity deeper. It's missing a lot,\" said Merrill Lynch analyst John Murphy in a note to clients. He cut Ford's rating to \"sell\" from \"neutral.\"

Ford said it would burn through nearly $4 billion in cash over the final two quarters of the year, leaving it with $20 billion in cash for auto operations at the end of 2006.

'DISAPPOINTED'

\"From a credit point of view, I am disappointed,\" said Philip Watkins, auto analyst at Commerzbank in London. \"I was looking for liquidity enhancement initiatives because they are running low on cash.\"

The automaker did not announce any plans to sell a stake in its Ford Credit arm, which has suffered higher borrowing costs after its debt rating was cut into junk territory.

Analysts also suggested Ford drop its Mercury brand and sell Jaguar or another luxury nameplate. Ford has said it is seeking a buyer for British sports car maker Aston Martin.

Commerzbank's Watkins said he hoped Ford would sell a majority stake in its financing arm, which he estimated could bring in $45 billion.

\"They don't need to be thinking about cash burn. They need to be thinking about making and selling cars,\" he said.

On September 5, Ford named Mulally, a former Boeing Co. (NYSE:BA - news) executive, as CEO, ending the troubled five-year stint of Bill Ford Jr. as the operational head of the automaker.

Morningstar's Novak said it was questionable whether Mulally, a highly regarded manufacturing executive but one of the few CEOs at a major automaker without prior industry experience, had much input in the new plan.

Ford's new restructuring replaces the company's initial \"Way Forward\" plan, which was announced in January and called for cutting up to 30,000 jobs and closing 14 plants by 2012.

After Ford posted a $1.4 billion loss in the first half and saw declining sales of its market-leading pickup trucks, the automaker promised more aggressive steps.

\"In the first quarter, full-size pickups did fairly well, with sales about even with last year,\" said Mark Fields, the Ford executive who spearheaded the revised turnaround plan. \"But in the second quarter, the bottom fell out.\"

Ford's U.S. auto sales have dropped 10 percent so far this year, dragged down by its F-150 pickups, which have been hurt by slower demand from construction crews and higher interest rates. Industrywide, auto sales are off about 4 percent.

In a pullback from its recent, more optimistic forecasts, Ford now expects its U.S. market share to slide to a range of 14 percent to 15 percent from near 17 percent.

\"These cuts need to be ahead of the curve,\" said Erich Merkle, an analyst at IRN Inc. \"(The lower forecast) gives me some confidence that they're at least coming clean here.\"

Ford's dividend was 20 cents annually for its common stock.

Ford shares dropped $1.09 to $8 on the New York Stock Exchange, down 12 percent, after falling as low as $7.75 earlier in the session. The stock had rallied from just above $6 in late July.

(Additional reporting by Kevin Krolicki and Jui Chakravorty)

-----------------------------------------------------------------
Speech by Thomas Friedman of The New York Times....

"When we were young kids growing up in America, we were told to eat our
vegetables at dinner and not leave them. Mothers said, 'think of the
starving children in India and finish the dinner.' And now I tell my
children: 'Finish your maths homework. Think of the children in India
who would make you starve, if you don't.'"

 
shankaracharya

Senior Desi
Member since: Dec 04
Posts: 768
Location:

Post ID: 85605 15-09-06 14:14:11
Report Abuse
rajcanadaMember of Administrators
Admin
Member since: Jul 03




Posts: 2713
Location: Kitchener, ON


....and Toyota is recruiting 2000 new workers http://lfpress.ca/newsstand/Business/2006/09/15/1842938-sun.html
-----------------------------------------------------------------
Give free food http://www.thehungersite.com ||

 
Post ID: 85633 15-09-06 21:14:06
Report Abuse
shankaracharya
Senior Desi
Member since: Dec 04




Posts: 768
Location:


Toyota versus Ford:

As seen on CBS news on this Friday, average line salary in Ford is USD 66 per hour while it is 45 in Toyota. The workers in Toyota are multitasking while in Ford have been doing the same work for the past many years. There are no unions in Toyota while it is unionised in Ford.

This is the ultimate and sweet revenge for the Japanese for the Pearl Harbor defeat.

-----------------------------------------------------------------
Speech by Thomas Friedman of The New York Times....

"When we were young kids growing up in America, we were told to eat our
vegetables at dinner and not leave them. Mothers said, 'think of the
starving children in India and finish the dinner.' And now I tell my
children: 'Finish your maths homework. Think of the children in India
who would make you starve, if you don't.'"

 
Post ID: 85672 16-09-06 11:28:26
Report Abuse
lana2005
Senior Desi
Member since: Feb 06




Posts: 545
Location: Toronto


In Ford restructuring, Windsor engine plant will lose jobs but Oakville will gain jobs as far as Canada is concerned.

If you listened to Buz Hargrove, he said he will try to save Windsor jobs by working with the management. He gave example of GM Oshawa plant. He said one Oshawa plant was to be closed but they kept working with the management and when GM was looking for a plant to produce new model, they clhose Oshwa and the Oshawa jobs were saved.

So you never know it may not impact Canada.


 
Post ID: 85673 16-09-06 11:29:22
Report Abuse
shankaracharya
Senior Desi
Member since: Dec 04




Posts: 768
Location:


The main reason for jobs coming up here is not due to the market here but due to OHIP. This is another reason for investing in real estate in areas around Cambridge.
-----------------------------------------------------------------
Speech by Thomas Friedman of The New York Times....

"When we were young kids growing up in America, we were told to eat our
vegetables at dinner and not leave them. Mothers said, 'think of the
starving children in India and finish the dinner.' And now I tell my
children: 'Finish your maths homework. Think of the children in India
who would make you starve, if you don't.'"

 
Post ID: 85675 16-09-06 11:32:16
Report Abuse
desertfox
Senior Desi
Member since: Jul 05




Posts: 133
Location: Toronto

New investments and model planned for India...
Its unfortunate that things are not happening for FORD. Main reason is people in that part of the world are still not waking upto the reality and global competition. I do agree with you there is no fun in working and ending up with few dollars which makes life miserable.... but with the kind of revolution happening especially in the manufacturing sectors because of globalisation and thanks to the IT revolution people in west don't see the Indian Passport in the same way as it was or used to be few years back... (of course scenario is yet to change in Middle East). The same FORD and GM who are strugling there pumping money into the ASIAN MARKET and trying to position them against the Koreans and Japanese... Even these days European are not far away... with few already invested and few more on the pipeline I'm sure the day is not far away when people in Manhattan drive a BMW made out of Chennai or a LEXUS Made of Bangalore and Mercedes made out Pune facilities.!!!!

Not to offend anyone...


 
Post ID: 85685 16-09-06 12:53:28
Report Abuse
< [ 1 ] >
 
Show Printable version
Send this page to a friend
Add to favorites
 


 
Web
CanadianDesi
Please Contribute!
Write an Article
Send Community News
Create Photo and Video Albums
Submit Good Pictures
List Useful Websites
Post Jobs
Submit Events
List for FREE!
Businesses
Classifieds
Social Organizations
Religious Places
Employment Agencies
Email Page
Your Email
Friend\'s Email

Advertise Contact Us Privacy Policy and Terms of Usage FAQ
Canadian Desi
© 2001 Marg eSolutions


Site designed, developed and maintained by Marg eSolutions Inc.