Ford to close three European plants

October 27, 2012

Ford Motor Company has announced the planned closure of three European facilities. In the UK, Ford’s assembly plant in Southampton and its stamping and tooling operations in Dagenham will close next year. Production will also end at its major assembly plant in Genk, Belgium, by the end of 2014. The three facilities currently employ around 5,700.

Ford states that this will address manufacturing overcapacity stemming from the more than 20% drop in total industry vehicle demand across Western Europe since 2007. New vehicle sales in the region have reached a nearly 20-year low this year and are expected to remain flat or fall further next year.

“The European market holds potential for profitable growth if we accelerate product development and move decisively to address our costs and overcapacity,” stated Stephen Odell, Chairman and CEO, Ford of Europe. “Even in today’s environment, we are increasing the introduction of new products, leveraging our One Ford global strengths.”  

Ford plans to move production of the next-generation Mondeo, S-MAX and Galaxy their assembly plant in Valencia, Spain. Pending further study, production of the C-MAX and Grand C-MAX compact multi-purpose vehicles would move from Valencia to Saarlouis, Germany, under the proposed plan.

Ford added that its UK operations will remain a centre of excellence for powertrain development and production. This includes plans to add a new next-generation, low-CO2, 2.0-litre diesel engine in Dagenham that will power future Ford vehicles from 2016. The engine will be developed at Ford’s Technical Centre in Dunton, Essex, one of the largest automotive R&D centres in the UK. Additional investment also is expected at Ford’s Bridgend Engine Plant in South Wales to support ongoing high volumes of petrol engine manufacture.

Manufacture of the Transit van is expected to be consolidated in Ford’s principal commercial vehicle manufacturing facility operated by Ford Otosan in Kocaeli, Turkey, in 2013.

The planned actions will reduce installed vehicle assembly capacity, excluding Russia, by 18% or 355,000 units. The related gross annual savings total $450 million to $500 million.

 

Posted by: Paul Whittaker, Editor ipmd.net, [email protected]   

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