Ford cuts 850 jobs and reviews pay deal

Car giant Ford is to axe up to 850 jobs in the UK in response to the "serious economic situation" affecting the motor industry, the firm announced today.

The Transit van plant in Southampton will be hardest hit, with between 400 and 500 jobs set to be lost by May.

Another 350 jobs will be lost across the company through a restructuring of salaried staff.

Ford also announced that it wanted to "re-evaluate" this year's pay deal of 5.2 per cent, saying that its business situation had worsened "significantly" since it was drawn up last October.

The company said in a statement: "Such a serious step would not normally be contemplated but in the unprecedented circumstances the priority is to ensure a sustainable Ford Motor Company."

John Fleming, chief executive of Ford of Europe said: "As demand across the industry continues to fall, we are facing some immediate and major challenges which require us to take decisive action to reduce all our costs, and to do so in ways which will best protect our business for the long term and ensure that we are well positioned to be among the winners when recovery does come.

"Those companies which act quickly in taking the right decisions will be those who not only survive but who emerge strongest from this deep recession. We aim to be one of those who emerge stronger than before."

One worker at the site in Southampton said there would be a mass meeting of workers.

Gary Alexander, a worker at the factory for 20 years, said outside the gates: "It's doom and gloom here at the moment and I think this factory's days are numbered.

"They (Ford) went back on their word about the pay offer and they said there would be no more job losses.

"They said the redundancies will be voluntary but they will not get that many."

Mr Alexander said that if the factory was really lucky it might get the chance to build a new chassis-cab model of the Transit but that would not be for several more years.

He said he did not think the workers would go on strike, "nobody wants that".

GMB officer Justin Bowden said: "Ford of Europe made a profit in excess of £1 billion in 2008. The pay offer reflects last year's rate of inflation and the massive contribution to that profit by the UK Ford workers.

"Yet again Ford is going back on its agreement with its workforce and this time it is on pay. They tabled a final offer at the end of last year and in good faith it has been overwhelmingly accepted.

"Now they are suggesting that they will not honour the offer on pay and to add insult to injury want to cut 850 highly skilled UK jobs."

Ford said declining customer demand for commercial vehicles had had a "significant" impact on its Southampton plant, which currently operates on less than four shifts a week.

"Continued non-production days with employees on basic pay are not affordable in the absence of a significant improvement in customer demand.

"To address this, the company will open a voluntary separation programme for salaried and hourly Southampton employees to bring manned capacity into line with customer demand, with between 400 and 500 employees leaving by May 2009. "