DETROIT – Ford Motor Co. (F), whose North American automotive operations lost $1.21 billion in the second quarter, said on Friday it is not ruling out deeper job cuts in its salaried work force to help return to sustained profits.
The No. 2 automaker, which has already announced plans to cut its North American white-collar work force by 8 percent this year, has seen profit margins squeezed by intense competition in the U.S. vehicle market and soaring costs of everything from raw materials to health care.
"(Chief Financial Officer) Don Leclair has said nothing is off the table," Ford spokesman Oscar Suris said.
"The company has operating challenges and they include issues with cost performance," he said. "We are developing plans to address those issues."
Suris was responding to questions about a report in The Wall Street Journal on Friday that said Ford was planning to eliminate as much as 30 percent of its current white-collar work force, or about 10,000 jobs, over the next few years.
Suris declined to confirm the 30 percent target, however.
Leclair said earlier this week that Ford was working to accelerate cost cuts and looking at ways to reduce excess production capacity.
He also said the company had already trimmed its salaried North American work force by about 1,000 positions so far this year. Ford had about 35,000 white-collar employees in North America before the latest cuts.
Ford cut its full-year earnings forecast last month for the second time this year and announced several belt-tightening measures to accelerate a turnaround plan it launched in January 2002.
"We just need to do more and do it faster. We're working on it," Leclair told reporters and analysts on Tuesday after Ford reported a 19 percent drop in second-quarter earnings.
Leclair also said the automaker would no longer issue quarterly earnings forecasts. Cross-town rival General Motors Corp. (GM) withdrew its earnings outlook for 2005 after reporting a stunning $1.1 billion first-quarter loss in April.
Both GM and Ford have been hurt by a dramatic slowdown in sales of profitable mid- and large-size sport utility vehicles amid high gasoline prices.
They are also struggling with higher borrowing costs following cuts in their debt ratings to "junk" status by the Standard & Poor's (search) rating agency in May.
Ford shares were up 2 cents at $10.66 on the New York Stock Exchange (search); GM was off 15 cents at $35.84.
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