DETROIT -- Ford Motor Co. plans to cut 700 jobs and eliminate the third shift at its small-car assembly plant in Wayne, Mich., in the company’s first large-scale layoff of Tier 2 workers.
The plant builds the Focus and C-Max, whose sales are down a combined 22 percent this year after falling 15 percent last year. The layoffs affect 673 hourly workers -- all of whom earn entry-level wages of about $17 to $19 an hour -- and 27 salaried employees, according to a notice filed with the State of Michigan.
Ford spokeswoman Kristina Adamski said the company is “confident” it can find other full-time positions for most of the workers. In the meantime, they will be eligible to receive 13 to 26 weeks of supplemental pay from Ford, depending on their seniority, bringing their income during that period to as much as 74 percent of their current wages when combined with state unemployment benefits.
The plant will lose about 200 hourly jobs in late June, 200 more in late July and the rest in late September. Workers cut in June or July will be used to fill in as summer help at other plants throughout the Detroit area, she said.
Rumors that the plant, known as Michigan Assembly, would cut its third shift have been swirling for weeks. Contacted last week by Automotive News, Ford said it had no announcements to make about any production changes at the plant.
The cuts are “unfortunate” but “not completely unexpected,” UAW Vice President Jimmy Settles said. In a statement, Settles said the union expects “nearly all” of the workers being laid off to get jobs at nearby Ford plants by early 2016.
“We are reminded from time to time that our industry is cyclical and volatile to market conditions,” Settles said in the statement. “Fortunately, through collective bargaining we have been able to negotiate provisions throughout the years that allow protections for our members adversely affected by production reductions.”
Michigan Assembly has 935 entry-level workers, all of whom were hired between January 2012 and July 2013, according to a listing posted online this month by the UAW’s Ford department.
Ford has hired nearly 15,000 hourly workers in the U.S. in the past four years. In recent months, it has bumped up more than 700 workers from the UAW’s second-tier wages to the top scale of more than $28 an hour, after hitting a cap on the percentage of Tier 2 workers it is contractually allowed.
Ford’s contract with the UAW expires in September. News of the layoffs comes less than a week after Ford revealed plans to invest $2.5 billion to expand several powertrain plants in Mexico, creating 3,800 jobs in that country.
The UAW reacted angrily to that announcement, saying Ford and other automakers investing in Mexico are exploiting “slave-like wages and corruption permissible through bad trade agreements.”