Fixing North America

While Nick Scheele has not announced all of the details of his turnaround plan, the general thrust is becoming clear. Ford's North American operation will cut jobs, consolidate its product development and import lessons about manufacturing efficiency from its European operation. Here is what we know so far. Ford will:

* Eliminate nearly 5,000 salaried jobs - roughly 10 percent of its U.S. white-collar workers - by offering employees early retirement. According to press reports, Ford also might offer early retirements to salaried workers outside the United States as well.

* Eliminate executive bonuses for 2001. For the previous year, Ford paid out $442 million in bonuses. The ban on bonuses could extend to all white-collar workers in North America. The bonuses of hourly workers are calculated separately.

* Consolidate product development for cars and trucks into one operation. The move comes at a time when sport wagons and other crossover vehicles are erasing distinctions between cars and trucks. The move echoes General Motors' earlier consolidation of its product development.

* Consider shutting down one or more truck assembly plants in the United States. But Ford's labor contract requires Ford to get approval from the United Auto Workers union. Given the union's emphasis on job security, that will not be easy. The labor contract will be ready for renewal in 2003.

You can reach Bradford Wernle at bwernle@autonews.com

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