Losses are predicted to cost Ford’s European division £930m this year – so they’ll close factories in Southampton and Dagenham to make up the shortfall ahead of a third-quarter financial call to investors next week.
Since demand for their cars dropped by one-fifth from 2007, Ford has made the difficult decision to begin reducing its European workforce to reduce its supply accordingly. At a conference yesterday executives announced that 1,400 jobs in two UK plants will be cut next year, at Southampton’s Transit factory and the stamping plant which supplies it in Dagenham. This move means that Britain will no longer assemble Ford vehicles, instead only parts and engines. While the shock is still sinking in for the 500 Southampton employees, it’s no secret that the timing could have been much better too; Transit van production in Southampton celebrates its 40th year in 2012.
Now, production of the Ford Transit will move to Turkey, where a plant in Kocaeli already has the workforce and resources to match the production schedule on which Southampton has operated over the past few years.
While still rather drastic, these cuts total less than a third of what will follow at Ford’s other big European presence. The factory in Genk, Belgium, is expected to shed 4,300 workers as the production cycle of the S-Max and Galaxy winds down along with the Mondeo. Executives had originally promised that production of the new Mondeo would begin next year but it seems that they’ve had a change of heart.
Considering that the UK is the source of most consumer demand for the Transit, it makes little sense to go ahead with the move to Turkey – but Europe’s chief exec Stephen Odell says it’s simply a matter of consolidating resources.