Ford merger to save up to dollars 3bn a year: North American and European operations being combined to give car maker economies of scale
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Your support makes all the difference.FORD is merging its North American and European operations in its biggest reorganisation since Ford of Europe was formed in 1967.
Alex Trotman, the British-born chairman, said economies of scale achieved should save dollars 2bn-dollars 3bn a year by the end of the decade.
Ford of Europe will disappear at the end of the year, when the UK and German operations will have worldwide responsibility for development of small front-wheel-drive cars, successors to the Mondeo, Escort and Fiesta.
Four other segments - large front-wheel-drive cars, large rear- wheel-drive cars, personal trucks and commercial trucks - will be developed by special units in Dearborn, Michigan. This means the Granada replacement will be designed in the US, which will also have overall responsibility for future Transit vans.
Jacques Nasser, chairman of Ford of Europe, who is taking over product development worldwide, said the changes could give more work to the UK and German development centres, though they would be handling three models instead of five. 'They will be responsible for those cars worldwide, which means they will be producing variations for countries with different legislative and market requirements.'
The volume of small cars for which Europe would be responsible would increase by at least 50 per cent, he said, with some of the extra produced in European factories.
Jaguar would continue to operate separately, drawing on the expertise of the US-based large vehicle development centre for parts such as engines and gearboxes. Mr Nasser would not be drawn on rumours that Jaguars could be built abroad. 'We are extremely sensitive about Jaguar's identity,' he said.
Mr Trotman said Mazda, in which Ford has a 20 per cent stake, was not being included in the reorganisation at this stage. 'We have these two big elephants called the US and Europe: we want to make them dance together properly first.'
For many years, car makers have been trying to create a 'world car' to take advantage of economies of scale. The latest fruit of Ford's transatlantic co-operation is the European-designed Mondeo, which will be built in the US and launched as the Contour and Mercury Mystique later this year.
Vauxhall, the UK arm of General Motors, announced a pre-tax profit of pounds 185.1m for 1993, down 17.3 per cent on 1992. It said its record 17.1 per cent market share in the UK was not enough to offset the effects of the Continental recession. Exports fell 58 per cent, leading to an 18.7 per cent fall in UK output.
(Photograph omitted)
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