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DebraLiStarr
12-05-2005, 12:38 PM
U.S. Automakers are having ll kinds of trouble - expect more cuts in the future.
Link to Reuters news story (http://news.yahoo.com/s/nm/20051205/bs_nm/autos_ford_plants_dc)

Mon Dec 5, 5:39 AM ET

Ford to close more than 8 plants

FRANKFURT (Reuters) - Ford Motor Co (NYSE:F - news) plans to close more than eight North American assembly and parts plants in a drive to revive faltering operations on the continent, industry paper Automotive News reported on Monday.

Citing a "key company insider," the paper said the number-two U.S. carmaker was likely to close at least five vehicle assembly plants: in Atlanta; St. Louis; St. Paul, Minnesota; Wixom, Michigan; and Cuautitlan, Mexico.

Several powertrain and stamping plants will also close, it cited the unidentified source as saying based on his knowledge of a turnaround plan Ford is preparing and the group's overcapacity problems.

A Ford of Europe spokesman said he could not confirm the report and reiterated that the company would unveil its restructuring plan in January.

Ford has said it would unveil in January a restructuring plan for North America, dubbed "Way Forward," which Chief Executive Bill Ford Jr. has said would include plant closures.

Like General Motors Corp (NYSE:GM - news), Ford has seen its margins squeezed by soaring health-care and raw material costs and a decline in U.S. market share. So far this year, Ford's North American unit has lost over $1.4 billion before taxes.

GM has announced plans to cut 30,000 jobs through 2008 and close 12 facilities to reduce excess capacity.

In a separate interview with Automotive News, Bill Ford

declined to give details of what the restructuring plan will include other than to reiterate that the group would reduce capacity and focus on new products that could fuel demand.

He confirmed that he had approached "most of the top executives in this industry" over the past six or seven years about coming to work for Ford, but added he was intent on remaining in the top post for now.

"Look, I'm firmly committed to this job, this company, and I'm going to fight like mad to get this company back to where it deserves to be," he said.

Bill Ford said the company would feel the pinch on margins as customers increasingly shift into cars from more lucrative products such as sport utility vehicles.

"Obviously, the segmentation downshift, from a margin standpoint, is not a good one. But we've planned these vehicles from the start to be a much healthier business proposition than their predecessors were. But once you start coming down the price point curve, you clearly have lower margins," he said.

Over time, margins should start to converge as customers opt for added content on small and mid-sized cars, he added.

Cueless Joey
12-06-2005, 10:45 AM
How about building better cars instead of offering rebates and zero percent financing? /ccboard/images/graemlins/tongue.gif
Sad. People are going to lose jobs b/c their execs are dumb.

DebraLiStarr
12-06-2005, 12:06 PM
<blockquote><font class="small">Quote Cueless Joey:</font><hr> How about building better cars instead of offering rebates and zero percent financing? /ccboard/images/graemlins/tongue.gif
Sad. People are going to lose jobs b/c their execs are dumb. <hr /></blockquote>

Exactly. Its "too much" to ask them for quality. How dare you point out the obvious. /ccboard/images/graemlins/cool.gif

catscradle
12-06-2005, 01:22 PM
<blockquote><font class="small">Quote Cueless Joey:</font><hr> How about building better cars instead of offering rebates and zero percent financing? /ccboard/images/graemlins/tongue.gif
Sad. People are going to lose jobs b/c their execs are dumb. <hr /></blockquote>

No, people are going to lose jobs because the car industry is far more competitive than it once was. Business executives (and Presidents) get far too much credit when things go right and far too much blame when things go in the dumper. I once worked for a database company named Cullinet, when it was riding high all the business mags were lauding John Cullinane (it's founder) as a business genius, then when things got tough he was a bum. Neither description was accurate. He was smart enough to take advantage of an oppourtunity when he saw it, but got on the relational DB boat too late. Doesn't make him a genius in the first place or dummy in the second place. I can remember Digital claiming the never did and never would lay anyone off, well their day came too. Same is true of the people running Ford or GM. Giant monoliths like them cannot turn easily and when they do chances are somebody is going to get hurt.
JMHO.

Deeman3
12-06-2005, 01:51 PM
<blockquote><font class="small">Quote catscradle:</font><hr> <blockquote><font class="small">Quote Cueless Joey:</font><hr> How about building better cars instead of offering rebates and zero percent financing? /ccboard/images/graemlins/tongue.gif
Sad. People are going to lose jobs b/c their execs are dumb. <hr /></blockquote>

No, people are going to lose jobs because the car industry is far more competitive than it once was. Business executives (and Presidents) get far too much credit when things go right and far too much blame when things go in the dumper. I once worked for a database company named Cullinet, when it was riding high all the business mags were lauding John Cullinane (it's founder) as a business genius, then when things got tough he was a bum. Neither description was accurate. He was smart enough to take advantage of an oppourtunity when he saw it, but got on the relational DB boat too late. Doesn't make him a genius in the first place or dummy in the second place. I can remember Digital claiming the never did and never would lay anyone off, well their day came too. Same is true of the people running Ford or GM. Giant monoliths like them cannot turn easily and when they do chances are somebody is going to get hurt.
JMHO. <hr /></blockquote> <font color="blue">

Catscradle:

You are exactly right. Having worked most of my career in GM and Nissan, I know how many very talented people they both have. However, there's just a lot more to it. Older workforce, higher insurance costs, burdensome union contracts, lower wages everywhere else. Hey, we used to lose jobs to Mexico, now Mexico is losing them to China and Detroit is losing them to Alabama!!!!

Simple math, it's hard for someone making $10 an hour to buy cars made but guys making $29 an hour. Especially when you can buy form someone making $11.00 an hour (Alabama) or $2.50 and hour (Mexico), or $1.08 an hour (Gwanchu, China).

Mix that with a fickle public who will buy stupid army tank sized trucks when gas is $2.00 a gallon but demand a high mileage vehicle when it goes over $2.50!


I have many friends suffering now but they knew it was coming at least in spurts for a while. Doesn't make it any easier when you have kids to feed. I only wish a U.S. President had enough clout to change economics like this but none do.


Deeman
</font color>

Cueless Joey
12-06-2005, 02:01 PM
And how much were these execs making?
How much was spent on advertising?
How much was spent on rebates plus low interest financing?
You go to Honda, you don't get jack for a deal except a car that runs.
My last Honda went 200,000 miles reliably.
Ford and GM? Known to nickle and dime you after 30,000 miles.
Moving the plants to Mexico ain't helping much I guess.

DickLeonard
12-07-2005, 06:32 AM
Debra it is obvious it is the Unions that are the cause of Fords problems.

We had Ford's Radiator plant in Green Island for 40 years or so during the reign of Henry Ford who made Sam Giancone look like a Girl Scout. The Union was always maintaining that Ford was doing it wrong. The Management/Engineers etc told the men do as we tell you We are the Boss.

The year before the plant was to close the Union prevailed and they increased prouction 70% making the Co look like fools. Nobody knows how to do the Job like the Worker anyone who doesn't listen to the Worker is Doomed. ####

Chopstick
12-07-2005, 08:57 AM
<blockquote><font class="small">Quote Deeman3:</font><hr>
I only wish a U.S. President had enough clout to change economics like this but none do.


Deeman
<hr /></blockquote>

Nixon tried to do it in the seventies with the wage and price freeze. The problem is economies are like the weather and they are largely driven by perception. Messin around with it can easily have unforseen consequenses. Take for example our recent so called recession. Nothing was actually wrong with the economy. People just thought there was. They saw the stock dip in 2000 and everybody said Oh no, here it comes.

The only two things that were wrong were Y2K and Greenspan was a bonehead. Everyone says Y2K wasn't noting but it was. Large companies had big budgets to hire guys like me to convert their systems. Small to midrange companies did not. Golfsmith, for example, a supplier of golf club parts and supplies shipped no product at all for the entire first quarter of 2000. Zero. All of these small to midrange companies had major impact to their supply lines and their cash flow. Larger companies were also affected. They could not ship product because they couldn't get parts.

Greenspan on the other hand had repeatedly raised interest rates trying to choke down the stock market and the market just ignored him. So, beginning in 2000 he slammed it with three rate hikes is rapid succession. He failed to foresee the divot in the country's cash flow that was just around the corner. Well, the profit numbers came out in the spring and Greenspan hit the market with that last rate hike and busted it out. Then everyone said the sky is falling.

There was nothing wrong with the economy and there still isn't. It is generally perceived that times are bad so they are. It is a self fullfilling prophecy.

DebraLiStarr
12-07-2005, 01:09 PM
<blockquote><font class="small">Quote DickLeonard:</font><hr> Debra it is obvious it is the Unions that are the cause of Fords problems.

We had Ford's Radiator plant in Green Island for 40 years or so during the reign of Henry Ford who made Sam Giancone look like a Girl Scout. The Union was always maintaining that Ford was doing it wrong. The Management/Engineers etc told the men do as we tell you We are the Boss.

The year before the plant was to close the Union prevailed and they increased prouction 70% making the Co look like fools. Nobody knows how to do the Job like the Worker anyone who doesn't listen to the Worker is Doomed. #### <hr /></blockquote>

####,
That is ancient history. Both Ford and GM have failed to keep up with other automakers in regards to the servicablity of their prodcut(s). Toyota &amp; Honda have provided what the public expects, which is quality. You can blame it on the unions or you can blame it on the executives - or you can blame Ford &amp; GM collectively as companies, and you'll hit a very big target.

DebraLiStarr
12-07-2005, 01:10 PM
<blockquote><font class="small">Quote DickLeonard:</font><hr> Debra it is obvious it is the Unions that are the cause of Fords problems.

We had Ford's Radiator plant in Green Island for 40 years or so during the reign of Henry Ford who made Sam Giancone look like a Girl Scout. The Union was always maintaining that Ford was doing it wrong. The Management/Engineers etc told the men do as we tell you We are the Boss.

The year before the plant was to close the Union prevailed and they increased prouction 70% making the Co look like fools. Nobody knows how to do the Job like the Worker anyone who doesn't listen to the Worker is Doomed. #### <hr /></blockquote>

####,
That is ancient history. Both Ford and GM have failed to keep up with other automakers in regards to the servicablity of their product(s). Toyota &amp; Honda have provided what the public expects, which is quality. You can blame it on the unions or you can blame it on the executives - or you can blame Ford &amp; GM collectively as companies, and you'll hit a very big target.