One of the great problems with Ford is that its work force is demoralized. It’s been hemorrhaging executives, and its middle management largely consists of folks waiting for their pensions to kick in. Try finding a kid at business school who think Ford would be a pretty cool place to land a job.
It’s a good thing that Ford has a plan to inspire confidence in its workforce.
Ford Motor Co. will aim to cut white-collar staffing, benefits and other costs by 30% as part of a broader restructuring plan the company's board of directors is expected to begin reviewing today, according to people familiar with the matter…
The 30% cut to salaried costs is on the high end of a 10% to 30% cut that had been studied by Ford, which has come under criticism that its first restructuring plan didn't go far enough. The auto maker will aim to cut back mostly on the number of managers and supervisors, with fewer cuts to lower-level, less-expensive salaried workers, said these people. The white-collar cuts will take place through the rest of this year and into 2007, said one Ford supervisor.
Under the plan, Ford managers will be told to look at their operating budgets and figure out how they can reach the 30% target. "It will be very difficult. A lot of people will lose their jobs and the people that stay will be asked to do a lot," said another person who had been briefed on Ford's plans.
Good luck with that thing Mulally!
Ford May Cut Salaried Costs 30% As Restructuring Push Accelerates [Wall Street Journal]