Ford poised to announce plans to close Belgian plant
Wednesday, 24 October 2012
GENK, Belgium: Ford Motor Co is poised to tell unions on Wednesday that it will close a factory employing 4,300 workers in the Belgian town of Genk, as it tries to stem losses in Europe and match capacity to tumbling demand.
Ford has summoned staff representatives to a meeting with European executives at 0700 GMT without giving an agenda, unions said.
Ford Europe managers, including Chief Executive Stephen Odell, are scheduled to meet Belgian Prime Minister Elio di Rupo and Employment Minister Monica De Coninck at 1100 GMT, a government spokesman said.
The executives are also due to meet members of the government of the Dutch-speaking region of Flanders where the plant is located at 1000 GMT.
The plant in eastern Belgium makes the Mondeo mid-size car and Galaxy and S-MAX minivans, but all three models are nearing the end of their current life cycles.
Sources with knowledge of production plans have said Ford is prepared to wind down the factory and build the next generation Mondeo elsewhere.
As consumers grapple with tight budgets, high unemployment and government austerity measures, economic gloom has translated into a slump in the region's auto market.
In September, European new car registrations shrank at the fastest pace in the past 12 months, leaving nearly all major brands nursing double-digit declines.
On Wednesday, French carmaker PSA Peugeot Citroen, which in July announced plans to cut 8,000 more jobs and close a plant near Paris, said third-quarter sales fell 3.9 percent.
Ford's Genk plant has operated on a four-day week for much of 2012, unions say, with only 15 more production days planned this year and none in December. Workers began blocking the gates when reports of the possible closure emerged on Monday.
Ford, which will present third-quarter results on Oct. 30, doubled its European loss forecast for 2012 to $1 billion in July and said action was needed to "decrease our production to match real demand".
Unions had said last month they were more optimistic about Genk's future after Ford set a date to start production of the new Mondeo there in October next year.
However, the sources, who asked not to be identified, said the tentative start date was not a reprieve for Genk.
If confirmed, Genk would be the second Belgian car factory to close in two years, after General Motors' Antwerp site. The scale of Ford's European losses has increased speculation that it will join Peugeot and GM's Opel in announcing a major plant closure.
Opel is in talks with unions on a restructuring plan leading to the eventual closure of its factory in Bochum, Germany. (Reuters)