Ford weighing deeper job cuts
DETROIT (Reuters) – Ford Motor Co.
American automotive operations lost $1.21 billion in the second
quarter, said on Friday it is not ruling out deeper job cuts in
its salaried work force to help return to sustained profits.
The No. 2 automaker, which has already announced plans to
cut its North American white-collar work force by 8 percent
this year, has seen profit margins squeezed by intense
competition in the U.S. vehicle market and soaring costs of
everything from raw materials to health care.
“(Chief Financial Officer) Don Leclair has said nothing is
off the table,” Ford spokesman Oscar Suris said.
“The company has operating challenges and they include
issues with cost performance,” he said. “We are developing
plans to address those issues.”
Suris was responding to questions about a report in The
Wall Street Journal on Friday that said Ford was planning to
eliminate as much as 30 percent of its current white-collar
work force, or about 10,000 jobs, over the next few years.
Suris declined to confirm the 30 percent target, however.
Leclair said earlier this week that Ford was working to
accelerate cost cuts and looking at ways to reduce excess
He also said the company had already trimmed its salaried
North American work force by about 1,000 positions so far this
year. Ford had about 35,000 white-collar employees in North
America before the latest cuts.
Ford cut its full-year earnings forecast last month for the
second time this year and announced several belt-tightening
measures to accelerate a turnaround plan it launched in January
“We just need to do more and do it faster. We’re working on
it,” Leclair told reporters and analysts on Tuesday after Ford
reported a 19 percent drop in second-quarter earnings.
Leclair also said the automaker would no longer issue
quarterly earnings forecasts. Cross-town rival General Motors
reporting a stunning $1.1 billion first-quarter loss in April.
Both GM and Ford have been hurt by a dramatic slowdown in
sales of profitable mid- and large-size sport utility vehicles
amid high gasoline prices.
They are also struggling with higher borrowing costs
following cuts in their debt ratings to “junk” status by the
Standard & Poor’s rating agency in May.
Ford shares were up 2 cents at $10.66 in late-morning trade
on the New York Stock Exchange; GM was off 15 cents at $35.84.