May 28, 2008

Ford To Cut 12% of Salary Workforce

I mentioned a couple days ago about Ford annoucing it will involuntarily cut its white collar workforce.

The numbers are out:

Ford Motor Co. will cut its U.S. salaried work force by between 10 percent and 12 percent in an effort to jump-start a turnaround plan stalling in the face of rising gasoline and raw materials prices.

And this time, it won't be voluntary.

Ford has 24,300 white-collar workers in the United States, Canada and Mexico. That could mean more than 2,000 U.S. workers could be getting pink slips by the end of July. It was not clear whether Ford Credit will be included in the cuts.

A manager in another department also told The Detroit News that he had been instructed to cut contract employees and identify between 10 percent and 15 percent of his staff to cut.

Ford has already eliminated 11,000 salaried positions in North America since the end of 2005 -- mostly through voluntary buyout and early retirement incentives

First off, how is cutting more salary positions going to make customers buy more cars? I just don't see how getting rid of employees is going to "jumpstart" the turnaround plan. If the plan isn't working, it certainly isn't because of the few employees you do have left.

And second, I am guessing that approx 50% of those 11,000 salaried positions that have already been cut in previous years are back working at Ford in contract positions, speaking strickly from experience.

So while Ford is dumping it's Pension and Health benefit obligations it really is not getting rid of the amount of people it says it is. Besides, you can't cut your way to profitablility.

And lastly, if you can dump nearly 15,000 of your salary employees either you were so bloated to begin with or the employees you do have left hate you. No wonder employee moral is pegged at 50% satisfied.

Hopefully they don't cut until the end of July, I would like to get vacation in this year. We haven't been on a vacation in 2 years and I sorely need this upcoming vacation. If cut before vacation, I can't in good conscious go on vacation and spend money.

Posted by Quality Weenie at May 28, 2008 09:31 AM | TrackBack