Ford Workers Anxious as Firm Plans to Cut Jobs, Drop Products

The auto industry is bracing for a Ford Motor Co. downsizing that could rival the size and scope of the one at General Motors Corp., where tens of thousands of jobs are being eliminated and several assembly plants are set to close.

Ford plans to release details of its plan -- called the "Way Forward" -- on Monday, when the automaker reports its 2005 earnings. In addition to the worker cuts and plant closings, analysts say, Ford is also likely to kill some slow-moving vehicle lines, such as the Freestar minivan.

Analysts speculate that Ford's cost-cutting moves will be similar to those announced by GM last year, when the world's No. 1 automaker said it would close all or part of 12 plants and cut 30,000 jobs by 2008, after losing nearly $4 billion during the first nine months of 2005. Ford spokeswoman Marcey Evans said the automaker is withholding the details of the plan until Monday morning. Ford employs about 123,000 people in North America.

David E. Cole, chairman of the Center for Automotive Research, who said he talked to Ford officials yesterday, said he expects a "substantial announcement" from Ford in which nothing was considered off the table. "They have not in any shape or form denied it," he said. "It's not just a rounding of the corners or trying to finesse things. They are betting the future of the company."

Anxiety within Ford, the second-largest U.S. automaker, is running high.

Joe Callahan, a 55-year-old worker at the St. Paul, Minn., plant that builds the Ford Ranger pickup truck, said he is preparing for the worst -- "if it comes to that," he said -- including the possibility of early retirement. "We've been having this hanging over our heads for quite a while," he said.

The Ranger has had slow sales, and the plant has often been mentioned as a target for closing. In 2004, Ford closed a plant in Edison, N.J., that also built the truck.

Monday's announcement will mark the second time in four years that Chairman William C. Ford Jr. has stepped forward to outline substantial cuts in the company that bears his family's name. Both Ford and GM are struggling to streamline operations as they respond to slowing sales and intensifying competition from global rivals. Ford's U.S. market share slipped to 17.4 percent in 2005 from 18.3 percent the year before, as the overall market grew slightly. Six years ago, Ford had 24 percent of the U.S. market.

Privately, some U.S. auto officials say the painful contraction by the U.S. auto industry giants may be only the beginning. Executives complain that health care costs and other labor expenses -- built up after years of negotiations with the United Auto Workers union -- put them at a disadvantage as other automakers push deeper and deeper into the U.S. market. Current contracts between the three Detroit auto companies and the UAW expire in September 2007.

Both GM and Ford have been losing market share in the United States as competitors continue to expand their vehicle lineups. The companies have also been caught short by the slowdown in sales of large sport-utility vehicles, which are high-profit vehicles.

"Ford, like every other vehicle manufacturer, is anticipating an extremely competitive marketplace over the next decade and therefore needs to make sure its portfolio, manufacturing footprint, back-end activities and technology are up to the task," said Michael Robinet, vice president of vehicle forecasting at CSM Worldwide, an auto industry research firm.

In recent years, European, Korean and Japanese competitors, led by Toyota Motor Corp., have successfully introduced popular minivans, pickups and SUVs, cutting into the heart of profits at GM and Ford. The companies have significant internal challenges, as well.