Ford Looks Abroad for Half of Parts

When auto executive Mark Fields takes his position at the head of Ford's North and South American operations next month, he will face losses of US$1 billion per quarter and corporate debt rated "junk." To spur the company's recovery, industry analysts have revealed that Ford will double the number of parts that it outsources to low-cost countries. According to Detroit News columnist Daniel Howes, the plan "means yet more bad news for American, Canadian, and European parts workers, if not necessarily for suppliers already migrating their businesses overseas." Ford employees can look forward to "more wrenching change" in coming years, as further restructuring eliminates jobs and combines brand divisions. While the changes mean uncertainty for workers, Ford must streamline its process to compete with more profitable companies, such as Toyota and Honda. This will mean establishing common processes and components across brands, a tactic that the Japanese automakers have already proven successful, but it may also entail eliminating jobs and closing plants before the company regains profitability. – YaleGlobal