Ford redundancy plan gathers pace

Employee costs have mounted

Ford has revealed that 38,000 of its unionised workers have agreed to take voluntary redundancy as part of a plan to transform the struggling business.

Ford is seeking to cut its US workforce by up to 30,000 staff by 2008 and has offered unionised staff a number of voluntary severance deals.

About 46% of United Auto Workers (UAW) union affiliated staff at Ford have now accepted one of these offers.

Ford has struggled with falling sales and mounting losses in its home market.

'Difficult decisions'

It has faced fierce competition from Japanese firms such as Toyota, while its own labour and employee costs have mounted.

Ford workers accepting voluntary redundancy will leave next year, although under the terms of Ford's offer, employees are free to change their mind right up to the last minute.

Ford said reducing its workforce would make the firm more efficient by better matching output to demand.

"While I know that in many cases decisions to leave the company were difficult for our employees, the acceptances received through this voluntary effort will help Ford to become more competitive," said chief executive Alan Mulally.