Ford Overhaul Likely Means Job Cuts

DEARBORN, Mich., Jan. 23, 2006 — -- The familiar jingle asks: "Have you driven a Ford lately?"

But these days, fewer and fewer Americans have.

A year ago, Ford had 122,877 employees, and 34 plants in North America, according to the company. But starting Monday, those numbers will be very different.

For 10 years, Ford's American market share has been in freefall, and the Ford Motor Company is slated to announce what it calls its "way forward" plan. It is seen by some as a drastic attempt to save a major corporation in deep trouble.

In just the past year, SUV sales are down nearly 30 percent. One model of Ford minivans is down 25 percent, and another is down 53 percent. Sedans? Ford is having trouble coming up with designs people want to buy.

"They haven't responded to the consumer [that is] saying, 'We want a better product; we want better quality," said Rebecca Lindland, an auto analyst with Global Insight.

Between 1999 and 2004, Ford eliminated nearly 40,000 employee positions worldwide. It's expected that Ford will announce Monday that it plans to trim close to that number in the coming years.

In addition, automotive experts are predicting that Ford will shut four or five of its 19 assembly plants in North America. The company utilized about 79 percent of its plant capacity in 2005. By comparison, Toyota assembly plants were operating at 111 percent.

On the prospective chopping block are Ford plants in Michigan, Missouri, Minnesota, Georgia and Mexico.

The 1,500 workers at the Wixom, Mich., plant fear their jobs will be cut -- because the plant is underutilized.

"That's not the hourly people who have underutilized it," said Jerry Petre, who has worked on the assembly line at Wixom for 42 years. "It's management."

At the bowling alley across from Ford's St. Louis assembly plant, they also fear their jobs are gone.

"You're a number," says Tom Veltrop, chuckling. "And they don't think much about your number either."

It's not only Ford. Just two months ago, General Motors Corp. made its own dramatic cuts.

Like General Motors, Ford has suffered a significant market share loss to foreign automakers. It has continually put out overly optimistic sales projections that have gained the disdain of Wall Street.

Ford also is saddled with the high cost of union labor, pensions and health care written into its union labor agreements.

"These are costs," Lindland said, "that Honda, Nissan, Toyota, Hyundai -- [foreign automakers] that manufacture in the U.S. -- don't face."

In its announcement Monday, industry analysts expect Ford to phase out unpopular minivans and build many more hybrid vehicles.

But whatever major cuts and overhauls Ford announces, the Ford Motor Company, whose Model-T assembly lines began a global revolution, is now struggling to keep up with it.

ABC News' Dean F. Reynolds contributed to this report.