Buyouts become job one at Ford

Moving to speed and possibly expand its plan to slash 30,000 jobs from its manufacturing payroll, Ford Motor Co. will offer retirement incentives and buyout packages of as much as $140,000 to all employees at its U.S. factories.

More than 75,000 blue-collar workers are eligible for the programs, disclosed yesterday by the United Auto Workers union and acknowledged by Ford. In all, Ford has about 110,000 employees in the United States.


The offer is similar to a retirement and buyout plan offered this year by General Motors Corp. and accepted by 34,000 of its 135,000 union workers.

Together, the agreements mean that nearly 200,000 hourly employees in the United States - or three-quarters of those working on the assembly lines of Detroit's three car companies - have been offered deals to give up their jobs this year. By contrast, nearly 1 million workers were employed by Detroit automakers at their peak in 1978. "This more or less convinces autoworkers that it's not just the company ... it's the domestic car industry," said Gary N. Chaison, a professor of labor relations at Clark University in Worcester, Mass. "I don't think that there's any autoworker right now that really sees a good future in the auto industry anymore."


The buyout offer has strengthened the expectation that Ford will announce more plant closings today, when it said it would disclose details of the next phase of its sweeping plan to overhaul the company, called the Way Forward.

Any new plant closings would be in addition to earlier plans to shut 14 plants by 2012, a move that will eliminate 30,000 jobs.

Separately, two top executives, both manufacturing specialists, quit Ford yesterday, a week after the automaker hired manufacturing ace Alan R. Mulally, 61, from Boeing Co. as chief executive.

One of the departing managers, Anne Stevens, 57, chief operating officer of Ford's Americas unit and a co-author of the company's 8-month-old Way Forward turnaround plan, was one of the highest-ranking women in the auto industry.

Also leaving was David T. Szczupak, group vice president of manufacturing for the Americas unit.

Stevens, 57, has made no secret of her desire to run a company on her own. She apparently lost her chance for further advancement at Ford when the automaker named Mulally as its new chief executive last week.

Mulally is taking on duties performed for the past five years by Ford Motor's chairman, William Clay Ford Jr., great-grandson of the company's founder, Henry Ford.

Bill Ford is keeping the chairman's title.


Mulally officially begins his job Oct. 1. He had no role in devising the cuts or the buyout program, although he has been briefed on the plans and will be responsible for implementing them.

Ford, scheduled to unveil details this morning of a revised rescue plan for its shrinking and money-losing North American automotive operation, acknowledged the all-inclusive job cutting program yesterday but did not provide details.

The union, however, posted a synopsis on its Web site. The document said Ford wanted workers who accepted the offers to leave the company by Sept. 1, 2007.

Previously, Ford had been taking a slower approach to payroll trimming, offering limited buyouts to workers at selected plants and setting 2012 as the deadline for achieving its goals.

Cole predicted that 30,000 or more workers would take advantage of Ford's retirement and buyout plans, but analyst Craig Hutson of GimmeCredit in New York put the likely number at 20,000 - about one-fourth of its payroll.

That's because Ford has fewer U.S. workers than GM, 25 percent of whose manufacturing employees accepted its offers.


Ford "probably would like almost everyone to take it," Hutson said. The company could then hire temporary workers and pay them lower hourly wages and offer fewer benefits than it was obligated to provide permanent employees under its union contracts.

Ford lost $1.4 billion in the first half of 2006, though, and is expected to lose far more in the second half from declining sales and charges for its restructuring. A report yesterday in the Detroit News said Ford's losses could total $9 billion this year.

The automaker recently said it would slash production by 21 percent in the fourth quarter because of sagging sales of its large sport utility vehicles and pickups, and is under pressure from analysts and investors to speed and expand its recovery efforts.

UAW President Ron Gettelfinger said members were "stepping up to make hard choices under difficult circumstances."

"Now," he said, "it's Ford Motor Co.'s responsibility to lead this company in a positive direction."

According to the UAW document, Ford will offer a half-dozen programs, with cash payments to departing workers of $65,000 to $140,000.


The union said the packages also were being offered to its members at Automotive Components Holdings, a group of factories once owned by Visteon Corp., Ford's former parts unit.

"They didn't have any alternative" to broadening the blue-collar buyout and retirement incentive plan, said Sean Egan, auto analyst at Egan-Jones Ratings, a Philadelphia-based corporate bond research firm.

John O'Dell writes for the Los Angeles Times. Times reporter Roger Vincent and The New York Times contributed to this article.