9:35am Thursday 5th February 2009
By Simon Carr
FORD bosses today explained why they are axing 500 Hampshire jobs.
They ssay the decision to axe 500 jobs from the giant Southampton plant is a response to "immediate and major challenges" the company is faced with.
The motor giant claims it can not afford to pay staff for "down days" and has been forced to cut half the Southampton workforce, push back plans for the new model Transit and renegotiate the pay deal.
The details were exclusively revealed in today's Daily Echo.
The full statement is below:
"In response to the serious economic situation affecting the automotive industry, Ford of Europe is implementing a number of cost reduction initiatives designed to protect its business and ensure it is well positioned to take full advantage of an eventual economic recovery.
Ford of Europe senior management has met with employee representatives in the UK and detailed the actions the company believed to be necessary. These include:
1) Salaried organisation.
The Company is proposing to restructure its salaried organisation around fewer employees. It will open a voluntary separation programme to release 350 employees by May 2009.
2) Commercial vehicle production.
Declining customer demand for commercial vehicles has had a significant impact on Southampton Plant, which currently operates on less than four shifts a week to produce the required number of Ford Transits. Continued non-production days with employees on basic pay are not affordable in the absence of a significant improvement in customer demand.
To address this, the company will open a voluntary separation programme for salaried and hourly Southampton employees to bring manned capacity into line with customer demand, with between 400 and 500 employees leaving by May 2009.
3) Commercial vehicle product development.
The award-winning Ford Transit provides the company with an acknowledged competitive advantage. The current Transit is a class-leading vehicle that will continue to compete successfully in the commercial vehicle market.
Ford has revised the timing of the launch of the new Transit to deploy more effectively the engineering resource at its UK research and development centre. Southampton Plant will continue to produce the current model Transit until the new model is introduced.
4) Pay negotiations.
The current pay negotiations took place in October/November 2008 and a 5.25% first-year increase was tabled at this time, reflecting the high inflation rate.
The business situation has worsened significantly since then and inflation has fallen. Conserving cash is the single most important task confronting the Company. In this difficult situation, the company has discussed with Union representatives the need to re-evaluate the pay offer in the light of the present and continuing business conditions.
Such a serious step would not normally be contemplated but in the unprecedented circumstances the priority is to ensure a sustainable Ford Motor Company.
In response, Union representatives said that they expected the November 2008 pay increase to be paid and asked the Company to confirm the Company's position on this increase.
The Company undertook to reflect on the increase, but it reiterated that further discussions were required given the seriousness of the situation.
"As demand across the industry continues to fall, we are facing some immediate and major challenges which require us to take decisive action to reduce all our costs - and to do so in ways which will best protect our business for the long term and ensure that we are well positioned to be among the winners when recovery does come," said Ford of Europe chairman and CEO,John Fleming.
"Those companies which act quickly in taking the right decisions will be those who not only survive but who emerge strongest from this deep recession. We aim to be one of those who emerge stronger than before," Fleming added.
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