SEPTEMBER 21, 2006 – On June 16, 1903, Henry Ford And eleven associates, with about $28,000 in cash started what would become a leader in the automotive world, Ford Motor Company. Fast forward a century later to find a very different picture. Today it’s a company struggling to stay afloat.
Ford announced this week it’s planning the biggest layoff and plant closure in its history. By 2008, the company is going to cut five billion dollars by letting go of nearly ten thousand white-collar workers and offering buyouts to close to seventy five thousand United Autoworker union members. The plan is to cut its manufacturing output by about twenty six percent to try and stay competitive against foreign automakers like Toyota. Reports issued say the company may be trying to position itself for a merger with General Motors. The two auto giants met earlier this week. Ford has also hired CEO Allan Mulally, who shrunk the boeing workforce dramatically in the last five years, as company president.
Ford lost close to two billion dollars in the first half of 2006. But it’s not the only auto company having problem. Chrysler said it too would cut its production by sixteen percent due to decreased sales.