Ford cuts aim to align supply with sales

The Wall Street Journal, citing unidentified sources, reported Friday that Ford is considering shutting down more factories and cutting salaried jobs and benefits by 10 percent to 30 percent.

Ford spokesman Oscar Suris declined to comment on the report.

The new production schedule will result in temporary shutdown this year at assembly plants in St. Thomas, Ontario; Chicago; Wixom, Mich.; Louisville, Ky.; Wayne, Mich.; St. Paul, Minn.; Kansas City, Mo.; Norfolk, Va.; and Dearborn, Mich.; Ford said.

Company officials would not say what specific impact the production cuts would have on workers. In general, hourly workers placed on temporary layoff receive 95 percent of their wages through state unemployment benefits and a supplement by Ford.

The United Auto Workers had no immediate comment on the announcement.

In Louisville, which has two affected plants, Mayor Jerry Abramson said he was told by Ford executives that the Louisville Assembly Plant, which makes the Ford Explorer and Mercury Mountaineer, will be shuttered for six weeks. The Kentucky Truck Plant, one of four plants producing the best-selling F-Series pickups, will close for five weeks in the fourth quarter, he said.

The production cuts are the second time this week that slower sales have forced Ford to announce changes. On Tuesday, it said it would trim the number of dealerships it has in 18 metropolitan areas. Dealer profits declined an average of 10 percent in the first half of 2006, the company has said.

Fitch downgraded Ford and its finance arm Ford Motor Credit Co. to “B” from “B+” and lowered its senior unsecured debt to “B+” from “BB-.”

“Volume declines in Ford’s pickup segment, along with continued declines in midsize and large SUVs, are likely to accelerate revenue declines and negative cash flows in 2006,” the agency said.

Standard & Poor’s Ratings Services and Moody’s Investors Service both put Ford’s credit ratings on review for possible downgrades further into junk territory.

MORE FROM AUTOS

Autos Section Front

Source: GM to begin repaying aid by year-end 37 percent of U.S. Saab dealerships to close Ford: New police cruiser to replace Crown Vic Automakers turn to safety to sell cars Texan drives $1 million car into marshes Dirtiest vehicles on America’s highways GM needs new Buick, Chevy entries to be hits IntelliDrive program blends technology, safety Chinese automaker aims to compete globally CEO lays out ambitious Chrysler road map Autos Section Front   Add Autos headlines to your news reader: