Ford May Cut 9,000 More U.S. Plant Jobs, Person Says

 (Bloomberg) -- Ford Motor Co., the world's third- largest automaker, may eliminate as many as 9,000 more U.S. factory jobs through its latest buyout offers, a person with direct knowledge of the situation said.

The cuts would be in addition to the 33,600 union workers who left through buyouts and early retirements in 2006 and 2007, when Ford lost a combined $15.3 billion. Further reductions may help Ford restore profit by speeding the hiring of new workers who would be paid about half as much as current employees.

``These are realistic numbers,'' said Harley Shaiken, a labor professor at the University of California at Berkeley. ``Workers are reassessing their options. It is a very tough choice.''

Ford doesn't have an estimate of how many workers will accept the buyouts, proposed to a first group of workers last month, the person said. The Dearborn, Michigan-based automaker won't limit the number who leave if more than the target range of 8,000 to 9,000 opt for the offers, the person said.

Marcey Evans, a Ford spokeswoman, declined to comment. Roger Kerson, a spokesman for the United Auto Workers union, didn't return telephone messages. The Detroit Free Press reported Feb. 9 that Ford had an internal target of 8,000, citing people familiar with the objective. That reduction would represent more than 12 percent of the carmaker's North American factory workers.

Ford's employment fell to 64,000 at the end of last year at North American plants from 99,500 two years earlier. That decline includes the 33,600 UAW-represented jobs shed through the buyout and retirement offers.

New Contract

Ford and the UAW in November agreed on a contract that permits the company to pay lower wages for new hires while keeping open five factories targeted for closure. Under the four-year agreement, Ford can pay up to 20 percent of its U.S. factory workers the reduced wage.

Under the accord, Ford's hourly costs for new workers will be $26 to $31, or about half the $60 expense for a current UAW member's wages and benefits.

Before any new, lower-paid workers can be hired, Ford must resolve the fate of workers at closed factories and at its Automotive Components Holdings unit. Automotive Components includes factories Ford took back from former parts subsidiary Visteon Corp. Most of those plants are being closed or sold, and some of the UAW-represented employees may go to Ford plants.

UAW workers at Automotive Components are eligible for buyouts. The outcome of the buyout program will determine how many of those employees are reassigned to Ford factories.

Ford has about 54,000 UAW-represented employees, with about 12,000 eligible to retire.

Savings

UAW President Ron Gettelfinger last month estimated that new contracts at Ford, General Motors Corp. and Chrysler LLC will save the automakers ``somewhere in the neighborhood'' of $1,000 per vehicle. Buyouts of higher paid workers will help Ford increase the number of new hires at lower wage levels.

Ford hopes to reach the 9,000 target through offers pending at four closed U.S. plants that will be broadened to other U.S. factories next week.

Workers at St. Louis; Edison, New Jersey; Norfolk, Virginia; and Atlanta began considering buyouts Jan. 22 and have a ``buyout window'' running through Feb. 28, Ford said Jan. 24 when it released 2007 year-end earnings. Workers from that group who accept buyouts are to leave the company by March 1.

Workers at those sites are being offered buyouts or relocation to other Ford plants. Workers who don't accept either choice will be placed on a ``no-pay, no-benefit leave,'' Ford's Evans said. That leave would last as long as their employment with Ford, she said.

 

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