Ford deepens European cuts, sees $3 billion losses
By Rhys Jones and Deepa Seetharaman
LONDON/DETROIT (Reuters) - Ford (F.N: Quote) unleashed a second volley of European job cuts and plant closures on Thursday to try to halt regional losses it expects to total $3 billion over two years.
A day after announcing the closure of a major car plant in Genk, Belgium, Ford told British unions it would scrap its Southampton van factory and an associated stamping facility in Dagenham next year, slashing 1,400 jobs.
Thursday's announced closures end vehicle manufacturing by Ford in Britain and bring its total job cuts to 6,200, reducing European production capacity by 18 percent to save $450-500 million a year, the company said.
With no market recovery in sight, car makers are struggling to scrap underused factories and surplus jobs that are racking up losses in Europe.
The Southampton plant was the fourth European vehicle plant closure announced this year.
Ford Chief Executive Alan Mulally told reporters and analysts the cutbacks were designed to "return profitability to our very important European operations by mid-decade", setting new medium-term operating margin goal of 6-8 percent.
Stephen Odell, chief executive of Ford of Europe, said during the same call that Peugeot's (PEUP.PA: Quote), French government-backed refinancing deal announced on Wednesday raised questions, highlighting transatlantic tension over the industry.
"I don't think it's sustainable for support from governments to keep competitive companies going forward, particularly in a protracted downsized economy," he said. Continued...