As expected, Ford is closing an UK plant. Unexpectedly, Ford is closing another one right with it, bringing EU plant closings to three in two days. Ford is closing its Ford Transit plant in Southampton, and it is closing the stamping plant in Dagenham with it, says Automobilwoche [sub].
“In 2013 Ford is closing its stamping plant in Dagenham and the Transit van plant in Southampton and that could lead to the loss of a couple of thousand jobs,” said union leader Roger Maddison.
This is part of a restructuring plan to stem losses in Europe, expected to exceed $1.5 billion this year, says Reuters.
According to Ford, installed vehicle assembly capacity will be lowered by 18 percent, with related gross annual savings of $450-500 million. Thirteen percent of its European workforce will be affected by the restructuring.
Ford expects to lose $1.5 billion this year in Europe. By 2015, Ford’s Europe business is projected to be back in the blacks again.
The plans were well received by financial analysts. “With GM Europe you always wonder what’s going on – it looks like they are still bogged down in deciding what to do,” London UBS analyst Philippe Houchois told Reuters.
Analysts at Morgan Stanley believe Ford is “demonstrating the vision and industrial courage” to make tough decisions that will pay off long-term, Reuters says.
According to USA Today, Ford’s move “could break the logjam and give other automakers permission to announce similar shutdowns.”
Europe has factory capacity to build about 22 million units a year. This year, sales of 14 million are expected.