SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report May 12, 2000
------------
(Date of earliest event reported)
FORD MOTOR COMPANY
------------------
(Exact name of registrant as specified in its charter)
Delaware
--------
(State or other jurisdiction of incorporation)
1-3950 38-0549190
------ ----------
(Commission File Number) (IRS Employer Identification No.)
One American Road, Dearborn, Michigan 48126
-------------------------------------- -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 313-322-3000
------------
<PAGE>
-2-
Item 5. Other Events.
- ---------------------
Our news release dated May 12, 2000 concerning our planned European
restructuring actions, and our new release dated May 23, 2000 concerning our
planned acquisition of Land Rover from BMW, filed as Exhibits 20.1 and 20.2 to
this Current Report on Form 8-K, are incorporated by reference herein.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
- ---------------------------------------------------------------------------
EXHIBITS
--------
Designation Description Method of Filing
- ----------- ----------- ----------------
Exhibit 20.1 News Release Filed with this Report
dated May 12, 2000
Exhibit 20.2 News Release Filed with this Report
dated May 23, 2000
SIGNATURE
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized on the date indicated.
FORD MOTOR COMPANY
-----------------------------
(Registrant)
Date: May 24, 2000 By: /s/ Kathryn S. Lamping
-------------------------
Kathryn S. Lamping
Assistant Secretary
<PAGE>
-3-
EXHIBIT INDEX
-------------
DESIGNATION DESCRIPTION
- ----------- -----------
Exhibit 20.1 News Release dated
May 12, 2000
Exhibit 20.2 News Release dated
May 23, 2000
News Release
Ford of Europe Corporate Affairs
Ford Motor Company
1/455 Eagle Way, Warley, Brentwood, Essex, CM13. 3BW., England
Telephone: 44-1277-252018; Fax: 44-1277-252896
E-Mail: [email protected]; Internet: http://media.ford.com
MAJOR RESTRUCTURING FOR FORD IN EUROPE
COLOGNE, Germany, 12 May, 2000 - Ford is to undertake a major restructuring of
its European operations in a key move to drive the company back to profitability
and strong, sustainable growth. The plan for its future was unveiled today,
following an extensive business review of its entire European operations.
The multi-faceted plan results from a three-month review of all Ford's product
plans and timings, its capacity utilisation and deployment of vehicle assembly,
powertrain manufacturing, and other key activities, including engineering. The
key elements of the plan are:
o Five-year investment of $500 million in Dagenham Engine Plant to
become more technology based as the global centre for diesel
engine manufacture.
o A proposed 50:50 joint venture company to be formed with
transmission specialists Getrag to engineer and manufacture
manual transmissions at facilities in Bordeaux, Halewood and
Cologne.
o Cessation of vehicle assembly and major body construction at
Dagenham by first quarter of 2002.
o Voluntary redundancy programme for around 1,900 employees at
Dagenham Body and Assembly, partially offset by about 500
incremental jobs associated with the expansion of diesel engine
production and engineering elsewhere within the Dagenham Estate.
Net job losses on the Dagenham Estate will therefore be around
1,400.
o Confirmation of $15 million investment for Ford Design Centre in
central London.
o Ford to proceed with $100 million Dagenham investment plans,
including $50 million for regeneration of Dagenham Estate, $26
million in the Press Shop and $10 million for the Wheel Plant.
o Creation of a further 360 new jobs with the transfer of
Commercial Vehicle Engineering from the U.S. to Britain.
o 240 diesel engine engineers to be relocated to Dagenham
o $12 million Ford-funded Employee Support Programme initiative.
<PAGE>
-2-
o Proposal for a Joint Advisory Board, including trade union,
government and local development agency representatives, to
oversee development and implementation of the Employee Support
Programme.
o Opportunity for expansion of diesel engine production at Dagenham
by 80-100,000 units per year.
o Additional opportunity for Bridgend Engine Plant to be source of
new petrol engine.
o Possible joint venture for forging and die casting operations in
Cologne.
Ford of Europe Chairman, Nick Scheele, said: "This is one of the most crucial
and difficult decisions we have ever had to make in Europe, but we needed to
take quick and decisive action. Our European business situation was totally
unacceptable.
"Fundamental to the entire review process was Ford's outlook for vehicle
assembly capacity in relation to expected demand. In 1999 Ford of Europe had
the capacity to build 2.2 million vehicles, but sold only 1.65 million. The
company does not anticipate that situation altering dramatically in the near
future unless decisive action is taken.
"Our new European management team plans to transform Ford's business in Europe
with accelerated product programmes - nine significant new product actions
every year over the next five years - and a rigorous focus on cost and asset
utilisation in particular. The plan targets growth in sales volume, market
share and much improved financial performance, in the next three to five years.
"By taking aggressive measures to increase our sales volume, to increase the
number of new product introductions, by regaining market share in our major
markets and by capitalising fully on opportunities in growth markets in central
and eastern Europe, we are going some way forward," said Mr.Scheele.
<PAGE>
-3-
"Nevertheless, even on our most optimistic projections, we do not expect to be
selling in excess of two million vehicles a year over the short to medium term.
With the planned actions we will take to improve efficiency and operating
flexibility, also adding to our capacity, we have the equivalent of one full
plant's capacity more than we need to meet demand."
Ford of Europe President, David Thursfield, and his business review team,
concluded that to leave the situation unaddressed would not only threaten the
viability of all Ford's plants, but also maintain an unsatisfactory business
situation.
"Over-capacity is a problem throughout the European automotive industry and we
are not alone in having to take tough decisions, but action was necessary," said
Mr.Thursfield.
"I know that what we plan to implement will be more difficult and painful for
some than others, but the study team has examined every possibility, every
option, and its recommendations are, we believe, the best way forward.
"Through these actions Ford of Europe will emerge as a more vigorous,
competitive and dynamic company. We are aiming for on-going cost reductions of
over $1 billion and these actions will be the single largest contribution to
that goal."
Restructuring Under Way
- -----------------------
The business review represents a culmination of Ford's restructuring of its
European operations, which has also included the sale of Azambuja plant in
Portugal and closure of the Plonsk plant in Poland; transferring Halewood
production over to Jaguar; selling Ford's share in the AutoEuropa facility in
Portugal to former project partner VW; the introduction of single-shift working
at Dagenham; a realignment of
<PAGE>
-4-
the workforce at Genk in Belgium to more realistically meet demand in the C/D
(Mondeo-size) car segment; and ending production of the Scorpio at Cologne.
It is also announced today that Ford will discontinue production of the Escort
and Transit at its assembly plant in Obchuk, in the Minsk region of Belarus, by
July of this year.
In addition, to achieve a re-balancing of capacity utilisation in existing
engine production, Ford will now concentrate all Zetec-SE volume at Bridgend, a
new family of four cylinder petrol engines at Valencia and 4.0litre V6 OHC/SOHC
volume at Cologne.
New Joint Venture Company For Transmissions
- -------------------------------------------
Ford has signed a letter of intent with German transmission specialists Getrag
to form a 50:50 joint venture company for the engineering and manufacture of a
range of manual transmissions. The new company will take ownership of existing
Ford manual transmission facilities at Bordeaux in France, Cologne in Germany,
and Halewood in Britain.
Subject to the successful completion of negotiations, the new joint venture
company is expected to begin operation in the fourth quarter of 2000. It would
continue to produce the IB5, MT75, MTX75 and VXT75 transmissions for Ford.
Further investment would be committed to develop and produce new transmission
products for Ford and other vehicle manufacturers, subject to any Government
grants being negotiated.
Mr.Thursfield said: "This is an outstanding business proposition for Ford.
Joining with a highly respected partner creates an opportunity to take the Ford
manual transmission business forward with fresh momentum, opening up the
prospect of
<PAGE>
-5-
innovative new products and future growth through sales to other vehicle
manufacturers."
Ford also intends to enter into negotiations with potential partners to
establish a joint venture for its forging and die casting operations in Cologne.
New Role For Dagenham Estate
- ----------------------------
Following the recommendations of the review team, Ford's senior European
management has elected to give the Dagenham Estate a new strategic role, with
new investment totalling $500 million over the next five years in diesel engine
engineering and manufacturing and also in other key areas of manufacturing
technology, process and logistics. This is in addition to $500 million already
invested over the last five years. As part of the transition of the estate it
is also planned, with regret, to cease vehicle assembly and major body
construction there by the first quarter of 2002.
It is anticipated that today's announcement, including the cessation of vehicle
production and major body construction, will result in an overall loss of some
1,400 jobs on the Dagenham Estate by the first quarter of 2002. A voluntary
requirement to reduce by some 1,900 employees will be offset by increased
diesel engine activities, resulting in a net reduction of 1,400. This is in
addition to the 1,350 job losses resulting from Ford's move to a single-shift
in the Body and Assembly Plant, announced in February. Ford will, however,
remain as London's largest manufacturing employer, with some 4,455 employees
continuing to work at the Dagenham Estate.
"It is with sincere regret that we have had to take this decision," said
Mr.Scheele. "We have a responsibility to employees and to the community and are
making it an absolute priority to minimise job losses through redeployment to
other Ford facilities
<PAGE>
-6-
in Britain, where job opportunities may be available. We will do everything
possible to achieve these job losses on a voluntary basis and are also
launching a $12 million ground-breaking Employee Support Programme, which will
provide help in terms of retraining, priority for re-hiring, self-employment
start-ups, independent financial advice and outplacement support.
"We also propose the formation of a Joint Advisory Board, including
representatives of the UK Government and trade unions, to oversee the
development and implementation of the Employee Support actions."
Ford Plans $3 Billion Investment in UK
- --------------------------------------
Ford Motor Company will continue to invest significantly in Britain and plans a
total investment of $3 billion in its facilities over the next five years.
In 1999 alone, over $600 million was invested by Ford in research and
engineering. Its Dunton-based Engineering Centre is Britain's largest
automotive research and engineering facility employing some 2,686 people and
will continue to play a major role in Ford's global vehicle programmes.
The Dagenham Press Shop is a major operation, running three shifts, which will
be modernised as a result of the review. Over the next two years, investment of
$26 million will further improve its competitiveness.
The Dagenham Wheel Plant, which produces steel wheels for a range of Ford
products, will receive a $10 million investment to re-tool and re-equip for the
production of high strength, light weight, steel wheels for upcoming models.
<PAGE>
-7-
Dagenham-based Group Tooling will also continue and will be expanded to include
development of tooling for the manufacture of doors, bonnets, bootlids and
other body parts, at all Ford's European facilities, with potential for
capacity expansion.
Existing plans for production of 700,000 petrol car engines and 55,000 V8
engines at Bridgend Engine plant, will continue. However, the plant has been
identified as a potential source for production of an additional new petrol
engine.
The company also intimated earlier this year that London would be the location
for a new design studio.
"I am pleased to be able to confirm today that we are continuing with our plans
to invest $15 million in the new Design Studio, which will open in central
London next year. We believe London is currently the most influential city in
the world for new design trends and our centre will perfectly place our
designers to explore other design mediums, opening their minds to a different
way of creating products for the consumer," said Mr.Scheele.
Global Source For Diesel Engines
- --------------------------------
Dagenham is Ford's sole global manufacturing source for diesel engines and,
with $500 million investment already approved over the next five years, is set
to produce three new engine families, with a resulting volume increase of 22
per cent. Now, the company is set to expand and develop its diesel capability
even more, with another new programme, providing potential for a further
80,000-100,000 extra units.
The new project involves amongst other things the addition of another new
family of diesel engines, the installation of additional manufacturing capacity
and also relocation of engineering resources from Dunton to Dagenham. Some 240
engineers,
<PAGE>
-8-
currently based at Dunton, will move to Dagenham as part of the new totally
integrated Diesel Engineering and Manufacturing team.
"The Dagenham Engine Plant is recognised as having produced high levels of
performance coupled with the flexibility to take advantage of business
situations as they arise and it is this track record that has generated the
confidence to invest further in the estate," said Mr.Thursfield.
Ford also confirmed that it will proceed with plans to invest more than $50
million for the regeneration of the Dagenham Estate, in close co-operation with
local government authorities, local development agencies, and involving closer
integration with the local community.
Existing plans include significant environmental upgrades of the estate,
construction of a modern single point of entry, construction of a new visitor
centre and new technical training centre, contribution of land for use as part
of a major technical education initiative and construction of a new flaghsip
dealership.
This now includes confirmation of an additional second phase, with further
physical upgrading, refurbishment of the now-unused main office block on the
historic river front landmark of the Dagenham Estate and further commitments to
education, with the establishment of an Engineering Faculty on the Education
Campus with major links to other Ford Partner Global Engineering faculties.
Specific Roles For Assembly Facilities
- --------------------------------------
Ford currently has five major assembly facilities producing passenger cars for
Ford in Europe, which the business review identified as being one too many. All
were subject to the same review process and to the possible cessation of
vehicle production.
<PAGE>
-9-
Genk, in Belgium, is to continue as the lead plant for Mondeo-size vehicles and
will also continue to produce the Transit. The cost of transferring Genk
production to other plants was prohibitive, the review demonstrated.
The other four existing plants all handle Ford requirements for B (Fiesta-size)
and C (Focus-size) class vehicles, for which current and projected demand is
such that these requirements could be handled by just three plants. One of
these will be nominated as a 'flex' plant, giving Ford the flexibility to
'swing' production between its B and C car platforms as required.
Saarlouis, in Germany, is to continue as lead plant for C segment vehicles,
such as the Ford Focus and has the potential to become a B/C car 'flex' plant
if required. Again, the investment and re-tooling implications in moving
production elsewhere would be prohibitive.
Valencia also has the flexibility for two-platform production, with a proven
capability for this over several years. Valencia also has a good track record
and is the lowest cost producer of the five major facilities. It currently
produces, on two different platforms, the Ford Focus and Fiesta-based Ford Ka.
Of the two remaining plants and, based on the long-term relative performance of
each, it has been decided to continue with assembly of B-segment vehicles in
Cologne.
It is also confirmed that Southampton Plant will assemble the new Transit range
of vehicles later this year and has recently benefited from investment in a new
paintshop and other facility modernisation in preparation for this.
<PAGE>
-10-
Ford will now progressively move all its Vehicle Operations plants in Europe to
flexible bodyshops, modular supply/assembly and with supplier parks, as new
model programmes are launched. All will also have the flexibility for
three-shift assembly as required.
Commercial Vehicle Engineering
- ------------------------------
A key part of the plan will be the transfer of Ford's Commercial Vehicle
Engineering activities from the US to Britain. In itself this will create some
360 new jobs in UK based engineering functions and once more give them
responsibility for roles including light and medium commercial vehicle projects
for Europe.
The Plan For The Future
- -----------------------
With its new business plan, Ford is sharply focused on profitability and
growth. The actions outlined are expected to be implemented in the period
between now and the first quarter of 2002.
"In developing our plan for the future, we have had to balance our current
needs and projections against inevitable cost implications and overall
viability. What we have announced is a plan which will ensure we create a
platform for sustainable business growth," added Mr Scheele.
# # #
Contact: Don Hume
44-1277-252018
News Release
Contact: Axel Obermueller Karen Hampton
BMW Group Ford Motor Company
0049 89 382-22332 313-594-4410
Hubert Bergmann Christoph Sieder
BMW Group Premier Automotive Group, Ford Motor Company
0049 89 382-20775 0044 207 5297118
BMW GROUP, FORD MOTOR COMPANY SIGN DEFINITIVE AGREEMENT FOR LAND ROVER
MUNICH, Germany/DEARBORN, Mich., May 23, 2000 - BMW Group and Ford Motor
Company today announced that they have signed a definitive agreement for Ford
to buy the Land Rover business from BMW.
Joachim Milberg, chairman of the Board of Management of BMW AG, and Jac Nasser,
Ford Motor Company president and CEO, reached the agreement after approximately
two months of due diligence following the companies' memorandum of
understanding (MOU) signed on March 16, 2000.
"Land Rover is truly one of the world's great brands. We are looking forward to
bringing the outstanding talent and product of Land Rover into the Ford Motor
Company family," said Nasser.
"This agreement, following the sale of Rover, is the second decisive step in
implementing the strategic reorientation of BMW Group," said Milberg. "And it
ensures that Land Rover, a brand rich in tradition, will be continued under the
leadership of Ford Motor Company."
<PAGE>
-2-
Under terms of the transaction, Ford will pay 3 billion euros (US$2.7 billion)
to buy the Land Rover business, which includes its full line-up of
four-wheel-drive vehicles - Range Rover, Discovery, Freelander and Defender.
As agreed upon in the MOU, two-thirds of the purchase price will be paid
immediately with the remaining third to be paid in 2005.
Ford Motor Company is acquiring the rights to the Land Rover brand, the Land
Rover plant in Solihull (Birmingham) as well as the Gaydon Research and
Development Centre, the Land Rover dealer network, the British Motor Industry
Heritage Centre (Gaydon), and a total workforce of approximately 13,000
employees.
In addition, BMW has agreed to complete the development of the successor to the
Range Rover on behalf of Ford Motor Company and will act as a supplier for
certain components and deliveries.
The transaction is expected to be completed June 30, subject to regulatory
approvals.
# # #
