The perilous state of America's automobile industry has prompted workers to stampede for the exit at cash-strapped Ford, where 38,000 people have chosen to accept voluntary redundancy terms to leave the struggling company.
Ford revealed today that by a deadline of Monday, almost half of its US factory workforce had signed up for severance packages offered under a radical streamlining - to cope with plunging demand for larger vehicles and ruthless competition from Japanese rivals.
The exodus will be one of America's biggest ever voluntary redundancy programs, beating the 34,400 departures agreed at General Motors earlier this year.
The acceptances exceeded Ford's target of 30,000 factory cuts which, taken together with white-collar redundancies and jobs already shed this year, will lead to a total of 50,000 job losses by 2008.
Ford's chief executive, Alan Mulally, said: "While I know that in many cases decisions to leave the company were difficult for our employees, the acceptances received through this voluntary effort will help Ford to become more competitive."
In common with its rival General Motors, Ford is engaged in a desperate battle to survive as traditionally loyal American customers desert pick-up trucks and sports utility vehicles in favour of cheaper, smaller vehicles to cope with high petrol prices.
American car-makers have proven less nimble than their foreign rivals in adjusting to the changing environment. The weak yen has made Japanese cars better value and employee healthcare costs, particularly for retired workers, add between $900 (£462)and $1,400 to the cost of every American car.
A choice of redundancy programs agreed with the United Autoworkers Union includes an offer of a lump sum of up to $140,000. Alternatively, Ford has offered to pay for four years' college tuition plus half of workers' pay and healthcare costs as they retrain.
Acceptances are so high that the company is likely to need temporary workers to keep its production line running.
Recovery chances
Bradley Rubin, an auto industry analyst at BNP Paribas in New York, said the outcome increased Ford's chances of recovery: "I don't think they're in as dire a situation today as they were in a few months ago. There's a greater chance of them being successful - they're finally taking the difficult steps needed to cut the workforce to meet retail demand."
Ford's losses reached $5.8bn in the three months to September - its worst quarterly deficit for 14 years. Earlier this week, the firm offered up factories, stocks of unsold vehicles and subsidiaries such as Volvo as security for loans of $18bn to fund its restructuring.
In a regulatory filing on Wednesday, the company warned that it expects a cash outflow from its automotive operations of $10bn over two years, plus $7bn of reorganisation expenses.
The industry's troubles have prompted anxieties about the economic future of America's motor heartland of Michigan. But the difficulties have also encouraged car manufacturers to look towards cleaner fuels in an effort to reignite demand.
At this week's Los Angeles motor show, GM's chairman Rick Wagoner announced several environmental initiatives including a new plug-in electric sports utility vehicle, the Saturn Vue Green Line.
"I think the public's ready for the next generation of automobiles," said Mr Wagoner.
Workers in Britain are watching events unfold anxiously. Ford ceased production of the Fiesta at Dagenham four years ago, axing 1,100 jobs.
The company still produces engines at Dagenham and Bridgend and makes vans in Southampton.
Unions are monitoring events at Ford's Jaguar and Land Rover marques and at Aston Martin, which the US group has put up for sale.
A spokesman for the T&G union said no further large-scale job losses were anticipated: "The UK has already taken its fair share of pain from Ford with the closure of mass-market production at Dagenham."
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