Ford Motor Co.?s CEO, William Clay Ford Jr, announced today that the company would shed 35,000 jobs worldwide, closing five plants and eliminating four vehicles.
"We strayed from what got us to the top of the mountain, and it cost us greatly," Ford said. He added that the restructuring "painful, but necessary."
The job cuts include 22,000 in North America. Plants to be closed are in Edison, N.J.; Oakville, Ontario; Brook Park, Ohio; Hazelwood, Mo. and the Vulcan Forge plant in Dearborn, Mich.
The vehicles to be dropped are the Escort, Cougar, Villager and Lincoln Continental.
Ford said it was taking a $4.1 billion one-time charge to pay for its plan.
"For most of the last decade the Ford Motor Company was on a roll," Ford said. "The great success we enjoyed may have caused us to underestimate the strength of our competitors."
The plan also includes the suspension of bonuses for company managers and the elimination of 401(k) matching contributions for employees. Ford added that he would accept no salary.
For the company, the need to restructure so severely represents a complete change from its position just a year ago, when it reported a $6.67 billion profit for 2000. Ford lost $692 million in the third quarter of 2001, and is expected to report its third straight losing quarter when it releases its fourth quarter financial statement next week.
"We realize that some of the things that must be done will be painful," said Ford, the great-grandson of founder Henry Ford. "I can't begin to describe how sorry I am about that."