Ford to close Belgian plant by end-2014

Wed Oct 24, 2012 8:52am EDT
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By Robert-Jan Bartunek and Nigel Davies

GENK, Belgium/MADRID (Reuters) - Ford Motor Co will close a Belgian factory employing 4,300 workers by the end of 2014, shifting production to Spain as the U.S. automaker tries to save money and stem European losses.

Europe's car market has slumped because the regional debt crisis has led to spending cuts and high unemployment, hurting consumer budgets.

Automakers are battling for survival, cutting production to match demand. This means factories, including the Ford plants in Genk and Valencia, have not been running at full capacity. Moving production to one place should allow Ford make savings.

Wage costs are also cheaper in Spain than in Belgium.

"The proposed restructuring of our European manufacturing operations is a fundamental part of our plan to strengthen Ford's business in Europe and to return to profitable growth," Ford Europe Chairman Stephen Odell said in a statement.

Ford management will also meet British unions on Thursday, a spokesman said. He declined to comment on media reports that Ford could also close its plant in Southampton where it makes its Transit van and employs just over 500 people.

The Genk plant makes the Mondeo mid-size car and Galaxy and S-MAX minivans, but the models are nearing the end of their life cycles. Ford said production of the next models would move to Valencia with the loss of 4,300 jobs by the end of 2014.

In turn, production of the C-MAX and Grand C-MAX compact multi-purpose vehicles could move from Valencia to Saarlouis, Germany, in 2014 under the proposed plan, it said.   Continued...

Workers at a Ford assembly plant react after an emergency meeting with the plant management in Genk October 24, 2012. Ford Motor Co announced to unions on Wednesday that it will close the factory employing 4,300 workers in the Belgian town of Genk, as it tries to stem losses in Europe and match capacity to tumbling demand. REUTERS/Francois Lenoir