Ford plans to close down its factory in Genk, Belgium
|   Sunday, October 28, 2012
Ford Motors has decided to pull down the shutters on its factory in Genk and this is expected to leave 4300 people jobless in Belgium. This is a big blow to the Belgium economy and the government is trying its best to persuade Ford to change its decision. This is a purely financial decision as Ford is facing huge losses from the unit. The talks to close down the facility are in its final stages and if approved, Ford could close down the unit as early as the middle of 2015.


The talks are on with the trade unions and this is a move taken by Ford to reestablish its gold on the European market. The decision for closure has been taken as the European sales have slumped by close to 20 percent while the production capacity has been increased. Western Europe has seen a major part of the losses through half of the past decade.

The Ford Mondeo production has fallen to close to 90,000 per year from 300,000 and as far as the market condition is concerned, the sales are unlikely to pick up any time soon. Therefore, this is the only way out for Ford and the company is doing the best it can to minimize losses.

If the current plans are followed, the factory at Genk could close down by the end of 2014 and the vehicles manufactured at Genk, namely the S Max, Mondeo and Galaxy could be shifted to the Valencia factory in Spain. In turn, the models manufactured at Valencia, namely the C Max MPV, and the Grande would be shifted to the German plant at Saarlouis.

Ford is planning to restructure the total European production and to bring this plan to action; the company needs to work on the present situation. As far as the main analysis is concerned, the Genk plant needs to be closed down to reduce further losses. The Ford outputs in Europe and producing just about 52 percent of their total capacity and this means huge losses for Ford on a daily average.

Hence cutting down on the number of employees will not help. So the only viable option left is to close down existing facilities across the continent. Ford is however hopeful of future investments in Europe and if things turn out well in the future, Ford is positive of reopening its Genk factory.

Higher authorities from Ford have given out formal announcements expressing their helplessness in closing down the facility. They have however hinted towards betterment in the future as early as possible. Belgium is in a fix at the moment and the huge amount of unemployment created could further affect the already wounded European market. This is set to have a huge impact on the world economy. However, the company sources have pleaded helplessness regarding the matter.

We have to wait and watch what the future holds and as far as the statistics are concerned, things are not looking very bright either and they will remain this way for quite some time now.
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