Ford to cut white-collar expenses by 15 percent
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DETROIT Jun 5, 2008; Soyoung Kim and David Bailey writing for Reutersreported that Ford Motor Co said on Thursday it will cut expenses forits white-collar work force by 15 percent over the next two months throughjob cuts, attrition and other actions.
The cuts, telegraphed by Ford in May, when it warned it would not meetits long-standing goal of returning to profitability in 2009, will come asthe automaker adjusts to a deeper-than-expected slump in U.S. vehiclesales, led by declines in sales of pickup trucks and SUVs.
"We told employees today we are going to cut salaried work force-relatedexpenses by 15 percent and complete the actions by August 1," said Fordspokeswoman Marcey Evans.
"This does include reductions in headcount and contract jobs, attritionand consolidation of positions," she said.
Ford, the No. 2 U.S. automaker, has about 24,300 salaried workers inNorth America. It warned employees in May that cuts in production wouldforce a reduction in its salaried and hourly work force.
Salaried workers who are dismissed will be offered standard companyseverance packages. Ford does not disclose details of the packages.
The automaker plans to offer buyouts to union-represented hourly workersat plants where the company has excess capacity due to declining demand forspecific vehicles such as trucks and SUVs.
More than 38,000 United Auto Workers union-represented workers have leftFord through buyout programs, including about 4,200 who accepted offersthat wrapped up in early 2008.
Ford executives have said the sharp rise in U.S. gas prices above $3.50per gallon triggered a permanent shift in demand to cars and crossovers andaway from larger vehicles.
The company has been shifting production plans toward smaller vehicles,including introducing a Fiesta subcompact in North America in 2010 thatwill be built in Mexico.
Editing for Reuters by Gerald E. McCormick/Jeffrey Benkoe
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