Ford Credit looking for its own Way Forward

The cutting and slashing continues over at FoMoCo's finance arm, Ford Motor Credit. On Tuesday they announced the closing of 59 offices within the U.S. and the elimination of 2,000 jobs from its 8,500 strong workforce in the United States and Canada. Additionally, the number of regional offices within North American will be reduced to six.

The process will continue through 2007, during which time the employees chosen to stay will either be transferred to another location or allowed to work out of home offices.

Hopefully, for Ford Motor Credit's employees, this should be the last stage of Ford's consolidation that began in 2002 and has cut over 6,000 jobs over the last four years.

The full press release can be viewed after the jump.

PRESS RELEASE

FORD MOTOR CREDIT COMPANY TO RESTRUCTURE ITS NORTH AMERICAN OPERATIONS, REDUCE GLOBAL COSTS

  • Fifty-nine branches will combine with six existing service centers, consolidating originations and servicing functions in the United States.
  • Dealers will continue to be served by sales personnel located in their markets; consolidated operations will provide dealers with extended hours of service and faster contract approvals.
  • Operating costs to be reduced through global cost reductions, North American restructuring and salaried personnel reductions of about 2,000 positions.

DEARBORN, Mich., Sept. 28, 2006 – Ford Motor Credit Company today announced it is consolidating and centralizing most of its originations and servicing operations in the United States to reduce costs and improve process efficiencies. At the same time, the company said it is reducing its operating costs through efforts that include salaried personnel reductions of about 2,000 positions in the United States and Canada.

This continues the company's global business transformation that has been ongoing for more than a decade. "We have a history of managing change effectively, and I'm confident the course we are on will be equally successful," said Mike Bannister, chairman and CEO.

Ford Motor Credit will consolidate its remaining 59 U.S. branches into six existing service centers, creating new business centers that will manage originations, dealer credit and wholesale operations in addition to the servicing functions already handled today. Sales employees who work directly with dealers will remain in local markets to maintain and enhance their strong dealer connections. Completion of the branch consolidation is expected by the end of 2007. A similar structure is being considered for Ford Motor Credit's operations in Canada, which currently has seven branches and one service center.

"As a company with strong business fundamentals, we believe this new structure will further strengthen our operational effectiveness," said Bannister. "Our strong collections processes will continue while we enhance our originations of automotive financing contracts. T he North American restructuring also will provide us with the flexibility and scale necessary to adapt to any changes in business conditions."

"Many of the same Ford Motor Credit salespeople who call on our dealers today will continue to do so going forward," said A.J. Wagner, president of Ford Motor Credit Company North America. "Our salespeople have a unique understanding of our dealers' market and business issues and are in the best position to provide them with practical solutions to support their business."

In the last decade, Ford Motor Credit has restructured operations in Australia, Germany, Japan, Mexico, North America and the UK with a focus on reducing costs and improving process efficiencies. Since 2003, Ford Motor Credit has closed nearly 110 branches in the U.S. and Canada.

Personnel reductions will be achieved through attrition, early retirements, voluntary separations and, if necessary, involuntary separations. Currently, about 8,600 employees work in Ford Motor Credit offices in the U.S. and Canada; the region accounts for 75 percent of the company's global business. As of June 30, 2006, the company's global managed receivables were $151 billion.

THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY. THIS IS IN NO WAY GIVING ANY LEGAL ADVICE OR REPRESENTATION. THE INFORMATION CONTAINED HEREIN WAS COMPILED FROM VARIOUS ARTICLES. FOR ANY LEGAL ADVICE OR REPRESENTATION SEEK YOUR OWN LEGAL COUNSEL.