Ford Asks Hourly Employees: Who Wants a Buyout?
Today, Ford Motor Company announced it would offer buyouts to all of its hourly workers, 54,000 in total. We normally don’t cover the business side of the automotive industry, but because of the scale of the buyouts and the impact they could have on the economy — and perhaps even product quality — we decided to blog about the news.
The first round of buyouts would go to workers from plants that are already closed, in Atlanta, St. Louis, Edison, N.J., and Norfolk, Va. The second round would hit all remaining workers at every U.S. Ford plant. Ford has cut 35,500 jobs since 2005.
So, who will build your next Ford Taurus? The company will hire new workers at lower wages. While one would think this would impact quality — a 10-year veteran should build a better car than a rookie — import manufacturers have opened plants, mainly in the South, with employees who have no automotive manufacturing background and done fine. Some examples include Hyundai and Subaru.
The buyout news comes on the heels of Ford announcing a $2.7 billion loss for 2007. Believe it or not, those financial results were better than expected. Ford forecasts a down year in sales and says it thinks the buyouts are timed correctly, when the company won’t need full capacity. It only has one new model slated to go on sale this year, the 2009 Ford Flex, as well as the redesigned F-150 pickup. We’ll see if those two important models’ production is affected by the buyouts.
Ford Offers Buyout to All Hourly Workers, Loses $2.8B in Q4 (USA Today)
