Ford Admits Likely Job Cuts, Operation Lulls amidst Heavy Losses
Sluggish sales continue to threaten Ford Australia's local operations as the carmaker announced on Wednesday planned adjustments that it hopes would arrest further losses.
Ford reported on Wedneday that its product lines of Focus, Ranger and Territory saw a 70 percent sales spike year-on-year but the surge came with a heavy price.
The company admitted too that Falcon model suffered sales declines of 24 percent in the same period, considerably offsetting whatever gains that other Ford vehicles have delivered in the past year.
Ford's overall result was so dismal that it announced in May millions of losses that reached $290 million, highlighting the difficulties faced by the local automotive industry, which local players chiefly blame on stiff competition from abroad and the high value of the Australian dollar.
The latter proved to be a disadvantage as local carmakers, Ford including, attempt to compete with countries that sell their vehicles at more affordable price per unit.
The federal and state governments have stepped in to prevent the local auto industry from collapsing, with Ford accepting earlier this year a rescue package of $103 million extended by Canberra and Victoria.
The bailout had intended for Ford to keep its Australian operations in Melbourne at least until 2016, preserving in the process thousands of jobs on its Broadmeadows and Geelong in Victoria.
But today, Ford said it has to implement measures that would stave off more losses.
Ford spokeswoman Sinead Phipps said in a statement that the adjustments were to reconfigure the company's overall settings to achieve balance with the prevalent market conditions.
"We are looking at a number of alternatives to allow us to manage our production schedule through the rest of this year, including additional down days or the possibility of a down balance (to produce less vehicles per day)," Ms Phipps was reported by the Australian Associated Press (AAP) as saying in a statement.
She confirmed too that the plan includes the temporary shutdown of Ford's two Melbourne production facilities, with the output lull to be imposed in July.
The Broadmeadows and Geelong plants will remain close for seven days, Ms Phipps said, and once production resumes, the output levels will be influenced by the vehicle demands presently seen in the market.
"We remain committed to our strategy of matching production to market demand," the Ford official stressed.
She added that job cuts could be one of the measures that Ford will be forced to roll out to rationalise its Australian operations, leaving the door open for another round of workforce reduction this year following the 240 employees that were let go in 2011.
Earlier this year, Ford had stood down some 1,800 workers for three days citing a problem with its local supply chain.