Buffalo News (New York),August 22, 2006, Saturday

Copyright 2006 Buffalo News
Buffalo News (New York)

Distributed by McClatchy-Tribune Business News

August 22, 2006 Tuesday

SECTION: BUSINESS AND FINANCIAL NEWS

HEADLINE: Ford to extend buyout, reports say

BYLINE: Matt Glynn, The Buffalo News, N.Y.

BODY:
Aug. 22--Ford Motor Co. is reportedly preparing to extend buyout offers to all its hourly employees in North America, a decision that could affect the Woodlawn stamping plant's work force of 1,440 people.
Ford will announce the buyouts and early retirements in September, according to Bloomberg News, which cited two unidentified sources familiar with the plan. They asked not to be identified because the program isn't public.
The moves would expand the "Way Forward" plan announced in January to shed as many as 30,000 jobs and close 14 factories in North America by 2012. Ford currently offers incentives only to hourly workers at plants targeted for shutdown.
Ford's Woodlawn work force includes about 150 salaried employees, according to the company. The site produces stamped parts used by Ford assembly plants around North America.
Charles Gangarossa, president and chairman of Local 897, United Auto Workers, which represents hourly workers at the Woodlawn plant, said he had not received notice of a broader buyout offer.
Gangarossa said if such an offer is extended, he expects Ford will create different offers depending on workers' years of seniority. "I'm sure they're going to open it to as many age groups as possible," he said.
The union leader also said he expected that a buyout would appear most appealing to workers who are close to 30 years of service with the company and are close to retiring.
Donald Berta, a longtime employee, said he has only heard rumors, but the idea of a buyout intrigued him. "I have 36 years of service, and I'd like to leave," he said. "I was kind of hoping to retire soon, anyway."
Berta, 59, said he was planning to wait until he was 62 to retire but might move up his timetable depending on any offer.
A Ford spokesman, Oscar Suris, would not confirm speculation about an expanded offer. "We'd rather talk about our specific decisions and those we'll discuss next month," he said.
Bloomberg's story did not speculate on the value of the buyout offers, but it noted that GM had offered packages worth up to $140,000 to its employees. About 34,000 GM workers, or about one in three, accepted the automaker's offers.
Ford's buyouts are part of the latest restructuring after a $1.44 billion first-half net loss. Based in Dearborn, Mich., Ford, the second-largest U.S. automaker, said in July it would accelerate job cuts and said last week it was making the biggest production cuts since the 1980s in the second half of this year.
Ford may have to offer more money than GM to get the same buyout-acceptance rate among union members, said Sean McAlinden, a labor analyst at the Center for Automotive Research in Ann Arbor, Mich. Ford's work force is younger, McAlinden said, because the automaker kept hiring into the 1990s after GM stopped.
"The only way to make sure people leave is to massively increase the buyout offers," McAlinden said. "My gut instinct is that they have to go way past the GM offer."
Arthur Wheaton of Cornell University School of Industrial and Labor Relations' extension in Buffalo, said the reported expanded offer reflects Ford's hurried restructuring efforts.
"Wall Street is expecting more change and a faster pace of change because General Motors offered buyouts to 113,000 workers across the board," Wheaton said.
Wheaton speculated that an expanded offer would get the most takers from younger workers who might want to explore other career options. Older workers may elect to stay with the company, he said.
The expanded buyouts would help Ford cut its labor costs more extensively, he said, but they carry a "mixed blessing": The automaker trims expenses while losing brainpower and worker experience. And that poses a longer-range risk to product quality, he added.
The buyouts could shrink the size of the Woodlawn work force, a cog in a regional automotive manufacturing sector. Though the Woodlawn plant's employment has declined over the years due to increased productivity and new technology, it remains a source of coveted high-wage manufacturing jobs.
The Woodlawn plant has already experienced some highs and lows this year. It is ramping up its use of a new press to supply two new vehicles, the Ford Edge and Lincoln MKX, which will be assembled starting this fall in Oakville, Ont. Ford invested $214 @million in the Woodlawn plant for the new press and related costs.
Bill Ford is preparing to eliminate 6,000 salaried jobs in Ford's North American operations through buyouts or, if necessary, firings, a person with knowledge of the plan said last week.
Bloomberg News contributed to this report.

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