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Ford Will Not Shut Plants in 2009

Auto manufacturer will close seven plants by 2008 and seven plants between 2010 and 2012; 30,000 jobs will be cut

As reported by The Associated Press

The Ford Motor Co. will not close plants in 2009 as part of its North American restructuring, although it will close seven plants between 2010 and 2012, the automaker said Tuesday in a regulatory filing.

Ford announced in January it would cut up to 30,000 jobs and close 14 facilities by 2012 in an effort to get its North American operations back to profitability. Ford lost $1.2 billion in the first quarter of this year.

So far, Ford has announced plans to close seven plants by 2008. Those plants are located in Wixom; St. Paul, MN.; Norfolk, VA.; St. Louis; Atlanta; Batavia, OH; and Windsor, Ontario. The company said the closures will reduce its North American manufacturing capacity by 26%.

Ford did not name the additional plants it will close in the filing with the Securities and Exchange Commission, but it did say the seven plants will be closed between 2010 and 2012.

Ford estimated it will have to pay up to $600 million in benefits to employees of those plants as a result of the closures. The company took a $1.75 billion charge in the first quarter of this year related to benefits for employees at the first seven plants to close, although Ford said that amount will likely change when it reaches final plant closure agreements with the United Auto Workers and Canadian Auto Workers unions.

Ford also said in the filing that it anticipates its global market share will be flat or down for the year as rising fuel costs and new products threaten sales of its full-size trucks and sport utility vehicles, a traditional area of strength.

Ford shares were up 20 cents to close at $7.17 on the New York Stock Exchange.

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