Ford to axe 'hundreds' of jobs in Europe

Ford logo Ford is hoping to revive sales in Europe

US car giant Ford has said that it will cut several hundred jobs in Europe because of declining demand, including in the UK.

Jobs will also go in Germany and in other parts of Europe.

The carmaker will offer voluntary buyouts for staff and cut jobs for "agency workers and purchased service", it said.

Ford has warned its European operations could suffer losses of $1bn (£630m) this year.

The carmaker has said it does not yet know the final number of axed workers in Europe.

Ford employs 15,000 workers in the UK and has plants at Southampton and Dagenham, among others.

In a dispute over pay and pensions, 67% of Ford's UK workers represented by the Unite union - about 1,200 white-collar employees - voted in favour of industrial action after a ballot in May.

"Ford of Europe expects the programmes to result in the reduction of several hundred salaried positions, but exact figures won't be known for a few months," Ford said.

"Any Ford salaried staff separations across all three programmes will be purely voluntary."

Analysis

Ford's decision to cut hundreds of jobs comes as no surprise, though it will certainly be a talking point as Europe's motor industry gathers at the Paris motor show.

With a $1bn likely loss looming over its European division this year, and with further weakness in Europe's car market expected in 2013, the automotive giant has long been desperate to cut costs to match earnings.

Doing so through a programme of voluntary redundancies reflects how reluctant chief executive Alan Mulally is about resorting to brutal tactics that could backfire, in terms of both industrial and government relations.

Lowest in decades

Earlier this month, the carmaker unveiled a string of new models, including revamped versions of its best-selling Fiesta, Mondeo and Kuga brands, to revive sales in Europe.

Ford's European chief executive Stephen Odell, speaking at the launch in Amsterdam, said at the time that Europe offered tremendous growth potential in the long term.

The US automotive giant's sales fell almost 10% in Europe during the first half of 2012, to its lowest level in 17 years.

Ford wants to reduce labour costs and improve plant utilisation in Europe, where industry watchers say it uses less than 65% of its capacity.

With closing factories in Germany politically difficult, Ford is trying to get the unions and national politicians in Belgium, Germany, Spain and the UK to agree to structural changes.

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