Ford confirms Bridgend closure plans: what’s behind the factory shutdown?
The announcement puts 1,700 jobs at risk and will cost the company $650m
Ford has confirmed it will close its production facility in Bridgend, South Wales, next year, which could result in the loss of 1,700 jobs.
Reports that the US car giant was considering the future of the factory, which makes diesel engines, began circulating last night, says Auto Express.
Today’s announcement confirms those rumours, though Ford intends to discuss the situation with trade unions before committing to the closure.
Stuart Rowley, president of Ford Europe, stressed that the carmaker was “committed to the UK”, but cited “changing customer demand” and “an absence of additional engine models” to manufacture as reasons for the shutdown.
“Creating a strong and sustainable Ford business in Europe requires us to make some difficult decisions,” he said, “including the need to scale our global engine manufacturing footprint to best serve our future vehicle portfolio.”
Ford will close the factory by September 2020, a move that will cost the company a one-off fee of $650m (£511m) and put around 1,700 jobs on the line.
What’s the reason behind the closure?
One of the key factors mentioned by Ford is the “significant underutilisation” of the facility’s capacity of 750,000 engines per year, Autocar reports.
The company claims that production will soon be halted on the Jaguar Land Rover-bound AJ-V8 engine, as it will on its own Sigma engine, the magazine says. Meanwhile, the 1.5-litre three-cylinder Ecoboost found in the Fiesta ST and new Focus has seen a “reduction in global demand”.
But Rowley has ruled out Brexit as one of the factors behind the closure, says Sky News.
“This action has nothing to do with Brexit,” he told reporters after today’s announcement, “and the simple way to think of that is, if Brexit had never happened, would there be a different decision, and the answer to that is no.”
What’s been the reaction?
Many employees interviewed by the BBC as they left the factory were concerned about the knock-on effects on businesses in the local area. One said that South Wales would “be like a ghost town” without the factory.
Meanwhile, Steve Turner, assistant general secretary of the Unite union, said Ford would be “taking an economic sledgehammer to the Welsh economy in an act of gross industrial sabotage if it doesn’t urgently reverse these closure plans”, The Daily Telegraph reports.
The proposed shutdown also concerns other industry exerts. Mike Hawes, head of the Society of Motor Manufacturers and Traders (SMMT), says it is “another crushing blow for UK automotive manufacturing and, especially, the staff and their families in and around Bridgend.
“Ford’s challenges are not unique: economic uncertainty at home and abroad, technological change and global trade issues are stressing markets and forcing companies to review operations and make difficult decisions.”