Difficult Transition Makes Ford Endure More

by Anthony Fontanelle - Date: 2007-02-27 - Word Count: 583 Share This!

The Ford Motor Co. foresees a difficult transition hence it is warning its managers that the next several months will be more enduring. The company is now figuring out how to cope with about a third fewer workers in its plants situated in the United States.

"We recognize the separations may result in a range of emotions by both employees that leave and those who remain as they say goodbye to fellow employees and transition to a new way of doing business," said Mark Fields, the president of Ford's Americas group, in an e-mail to the company's managers in the United States. "During this time, employees may experience significant emotional challenges and counseling is available."

The company is completing white-collar buyouts which are aimed at slashing approximately 10,000 salaried positions by next year. In his e-mail, Fields said participation in the voluntary program was better than expected, but he acknowledged that the layoffs are still likely in some departments that did not meet their staff reduction goals. He furthermore added, "While overall voluntary acceptance rates were better than projected, every organization must meet its own salaried cost task and, in some groups, involuntary separations may be required."

Salaried workers were given until Monday to decide. Ford, on the other hand, has to approve the workers' separation requests until 27 February. Too many workers have signed up for the voluntary separation program in some departments. As such, the company is forced to turn down some of the buyout requests. "The company is in the process of evaluating how many acceptances can be granted, based on the known window of acceptances and normal attrition," Fields said.

According to analyst Erich Merkle of IRN Inc., "Cutting salaried jobs could actually help Ford bring products to market faster." Merkle added, "There's probably a lot of room to do more with less. There's far too many meetings. Far too much research. I'm hoping that they are able to streamline that and make those product decisions a little bit faster than they have in the past."

In the previous weeks, Ford was bombarded with dealers and workers growing concerns for plan. In a conference with the company's dealers, the latter have urged Alan Mullaly, the Ford CEO, to reassure them that the restructure plan is indeed solid for them to cope with the upsetting crisis. Mulally said he feels the company's turnaround plan is making progress and that he plans to stay the course. He added the company will continue to place a marketing emphasis on trucks and pull back inventory to get more in line with demand.

As part of the turnaround plan of the company, Ford is expanding its range of promising vehicles. Ford, Lincoln and Mercury presented a wide array of new and updated models to offer a boost in customer demand for fuel-efficiency, distinctive design, and safety. This expansion also called for tuning the vehicles for maximum performance. Some of the models use EBC rotors to produce a high-performing street machine. Jaguar and Land Rover also introduced a more promising lineup.

"Too often in the past, our philosophy was to move the metal -- to build the vehicles that we had the capacity to build and then price them -- often discounting them -- to get the customer to bite," said Fields. "We didn't look far enough beyond the horizon, tracking the trends, knowing our customers, and seeing the day when they might want something else. I'm proud to tell you, that's the Ford of the past -- not the Ford of today."

Related Tags: auto parts, ebc rotors

Anthony Fontanelle is a 35-year-old automotive buff who grew up in the Windy City. He does freelance work for an automotive magazine when he is not busy customizing cars in his shop.

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