by Euric » Thu 20 Jul 2006, 22:59:49
$this->bbcode_second_pass_quote('Fergus', 'h')ttp://news.bbc.co.uk/2/hi/business/5198324.stm
Ford is closing 12 plants (maybe it was 14 plants) and cutting 30,000 jobs by 2012.
Ford is hurting.....big time.
Though I think a lot of Fords problems lie within their management decisions over the last 20 years, I am sure the oil impact and economic impact of the oil impact will hasten their slide down to bankruptcy or insolvency.
Could be worth watching over the next couple of years. The first of the big guys are starting to get dazed, a few more punches and we could have the first casualty of PO.
America's big three is the suffering the effects of having to support the tens of thousands of former workers via pensions and benefits some 25 or more years after they have retired. This is taking a big bite out of the operating capital.
Because these companies are still unionized it is impossible to just take away or cut back on continuing to provide these benefits. In the days when these companies were going strong and there was no foreign competition paying out benefits to retired workers wasn't seen as a big expense considering that people didn't live much longer after they retired. But as the retirees started to live into their 80s and 90s these companies were paying out benefits to people for as much time that they were no longer producing then when they were working and producing.
these companies have two choices;
1.) Cut the cord and let the retirees fend for themselves.
2.) Don't do anything and just go bankrupt.
Either way, the benefits will cease.