Ford has confirmed that it will close its factory in Southampton in mid-2013. The move ends more than 100 years of vehicle production in the UK and will cost 500 people their jobs, plus lots more in the related supply chain.
Transit production will move to the Ford Otosan facility in Kocaeli, Turkey, in 2013.
Further to this, Ford will also close its stamping and tooling operations in Dagenham - which currently employs 750 people - as well as logistics and support staff, taking total job losses to 1,400 in the UK.
Ford cites the weakness in the European market - which accounts for slightly more than a quarter of Ford’s total vehicle volume - as the reason for its decision to cut plants and its dealer’s stock of cars to record low levels.
Speaking during a media conference, Ford chairman and CEO Alan Mulally said: “We’re moving decisively to match production with demand… we recognise the impact our actions will have on Ford employees and their families and will work together with all stakeholders during this necessary transformation of our business...”
Ford did confirm that it will invest in its Dagenham diesel engine production facility, and retain the current workforce of 2,000 people on the engine line. A new family of clean 2.0-litre diesel engines will be developed at Ford’s Dunton R&D centre, which employs 3,500 people, and go into production at Dagenham in 2016.
Ford of Europe CEO, Stephen Odell, added that Ford will spend “£1.5 billion in UK focusing on designing and engineering engines, while the redundancies in the UK are voluntary, and we’ll endeavor to move people that want to stay round the organization.”
Ford also confirmed that it will push ahead with its plans to close the Mondeo factory in Genk, Belgium, giving a total of 6,200 redundancies in Europe - or 13 per cent of its European workforce.
This also means that the new Mondeo won’t go on sale in Europe until the end of 2014, with the S-MAX and Galaxy replacements not coming until 2015 at the earliest.
Odell added: "Following the consultation process with Genk, the launch of the Mondeo would obviously be pushed back to the end of 2014, with S-MAX and Galaxy, in a refreshed form, following after that."
"Given current demand and even recent awards for that car we feel there are plenty of good signs that we can keep demand (for the current car) up."
He also alluded to the fact that the 1.0-litre EcoBoost, scheduled to arrive in the new Mondeo, could be fitted to the existing car to increase its appeal: "We have new powertrain opportunities, especially from a low CO2 standpoint..."
Talking about the decision to close the Genk plant, Odell said: “The consultations with unions will take four-to-six months to complete. We’ve gone through a lot of thought and as difficult as it was, we absolutely believe it was the right thing to do as Genk was out lowest utilized plant.”
To improve its flagging European fortunes, Ford will introduce 15 new models by 2015, including the new EcoSport and Edge SUVs, and Mustang sports car. Despite predicting a $1.5billion loss in 2012, the firm claims it will return Ford of Europe back to 6-8 per cent profitability by mid-decade.