19 ms·

Ford to cut North America, Asia salaried workers by 10 percent

80 points by blcArmadillo 9y ago

gogopuppygogo 9y ago
Trump, Trump, he's our man, if he can't do it then no one can.
- sctb 9y ago
  Please comment civilly and substantively or not at all. https://news.ycombinator.com/newswelcome.html https://news.ycombinator.com/newswelcome.html https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
MichaelBurge 9y ago
> A person briefed on the plan said Ford plans to offer generous early retirement incentives to reduce its salaried headcount by Oct. 1 Why do companies offer early retirement incentives? Wouldn't it be cheaper to wait until the day(or week or month) that you'd otherwise offer them to leave on, and fire them right then without any benefits? Especially since the stated purpose of it is to save money. Ford in particular would probably get some negative PR. And since the most expensive employees are older, they might try to sue you for age discrimination. Is it just risk mitigation, or does Ford actually benefit from the incentive? 10% might be too large of a change to do all at once, especially at Ford's size; so buying them off lets them get rid of people gradually without surprising people. I can understand why executives have to be bought off: They usually negotiate an accelerated stock vesting if they get fired without cause. What about anyone below that?
- EliRivers 9y ago
  I know that in the old days, the long long ago, companies would sometimes act in ways that benefitted their employees out of little more than just not wanting to screw them over completely. Basically just out of niceness and decency. Maybe the people at Ford are like these old-timers who tell me about such things. Also, I know that Ford certainly used to have a solid union. I wouldn't be surprised if they have workers who can't simply be instantly fired without cause and with cancellation of all benefits. Like some kind of worker's paradise.
- sebleon 9y ago
  What you described is a short term savings scheme that would destroy the company's long term reputation. Who would want to work for a management team that screwed employees like that? It's hard to imagine that the cost-savings justifying the long-term consequences of losing of the best employees + candidates to competitors.
- badlucklottery 9y ago
  >Wouldn't it be cheaper to wait until the day(or week or month) that you'd otherwise offer them to leave on, and fire them right then without any benefits? That's a trick you can pull once. And after you do all of the skilled employees are going to be eyeing the door.
- legitster 9y ago
  Simple answer: Unions. They can't just layoff people without repercussions. Complex answer: Businesses that have been around this long have learned to survive by not making enemies. A tenant of this brand of capitalism is that it is cheaper to make mutually beneficial deals than to 'win'. Also, because the brand is so tied up in American identify, and many of their workers are their own consumers, they don't want to muddy the waters, especially if they expect to hire back some of the same workers again later.
  - ph0rd 9y ago
    >Simple answer: Unions. They can't just layoff people without repercussions. salaried employees at ford aren't unionized, for the most part. The rest of this is correct.
- Broken_Hippo 9y ago
  Why do companies offer early retirement incentives? Because it is easier to reduce your workforce when folks choose to leave rather than if they go unwillingly. If you get enough reduction from this method, folks aren't as worried about their jobs. And i'm guessing in the long term, there are fewer disgruntled ex-employees. Wouldn't it be cheaper to wait until the day(or week or month) that you'd otherwise offer them to leave on, and fire them right then without any benefits? Especially since the stated purpose of it is to save money. Possibly upfront, but not in the long run. The nearly retired folks are more likely to earn more money and will likely be retiring at some point anyway so a fair amount of the costs will be happening nevertheless. From what I've seen, usually there is a decent one-time bonus and possibly earlier earning on retirement. With regular firing, unions generally require the lowest seniority folks go first. Over time, this is actually more expensive with day to day operations because these folks tend to earn the least. Plus all the hits to the employee morale.
- 4c2383f5c88e911 9y ago
  I like how open you are about doing class warfare, but destroying the small layer of ethics carefully woven on top of your business policy isn't a good plan in the long run.
- CydeWeys 9y ago
  I really hope that, for your and everyone else's sake, that you are not ever in a position of management at any company, seeing as this is the way you think about running a business and treating employees.
  - MichaelBurge 9y ago
    You're reading too much into the comment. I'm just looking for a list of the drawbacks. Two of the ones mentioned(unions, and long-lived stable companies depend on their reputation more than usual) hadn't occurred to me.
- DanHulton 9y ago
  This is potentially the most sociopathic comment I've read on this site. Here's a reason: because it's an awful thing to do.
- gozur88 9y ago
  It's PR, but it's also protection from legal trouble. Typically when you give some kind of severance package you require the recipient to sign away any right to sue. Also, with large companies even during layoffs they're hiring for particular skilled positions. You don't want to get the reputation as an employer which mistreats its people.
legitster 9y ago
I would recommend anyone read the book American Icon, which is about Ford's rise from the ashes in the 2000s. It's one of those thick reads, but well worth it. It's sad to see them struggling, because their car lineup has been absolutely brilliant for the last few years. But now that the industry is at it's plateau, investors are very paranoid about any car company trying to invest in new areas (Ford spent much of it's earnings on tech companies). They would rather just see dividends instead.
- nvivo 9y ago
  I think it's funny how we never act so selflessly in our entire lifes, but expect investors, which are people that made their career goal to be good at making more money, to suddenly grow this moral guideline and be worse at their job just for the greater good.
  - icebraining 9y ago
    Such a small post, so many strange ideas: 1) That choosing investment over dividends must be a selfless act that makes one worse at their job (rather than simply a different option, possibly even more lucrative). 2) That "we" (who?) don't make life choices for selfless reasons, when it's plainly obvious that many do. 3) The idea that investors don't have a moral guideline AND that that's somehow acceptable. I didn't downvote you, by the way.
    - stupidhn 9y ago
      >That choosing investment over dividends must be a selfless act that makes one worse at their job (rather than simply a different option, possibly even more lucrative). This implies that they can't do both investing and paying dividends at the same time. What leads you to believe investment by F isn't sufficient?
      - icebraining 9y ago
        I have absolutely no opinion on the investment choices by Ford, you should ask legitster about that.
ensiferum 9y ago
If the goverment wants jobs then why don't they just do so? They have the mandate to create new regulation. They could for example say that pumping gas at the station is a job that requires training and only qualified personnel can do this job. That would instantly create new jobs and the businesses would be forced to accommodate. Hiring someone is a last recourse for any business since it's very expensive so you can't expect businesses to magically create jobs.
- remline 9y ago
  The concept behind sin taxes was to tax what you don't like more than what you do like. Modern governments apparently hate jobs and earned income the most.
  - foota 9y ago
    How would you rather the govt tax? Seems to be a lot more efficient to tax income rather than to have separate taxes on different kinds of consumption and investment.
    - Kluny 9y ago
      As it stands, income gets higher tax than capital gains. Capital gains are taxed at half the income tax rate. So people who make most of their money on capital gains are 1) very wealthy 2) paying less tax than poorer people who rely on working for a living 3) incentivized to keep their money in investment vehicles and out of circulation. I'd suggest reversing it and taxing capital gains at the full rate and income tax at half. This is how it's done in Switzerland I believe, if you want a case study. They seem like they're doing okay.
      - christocracy 9y ago
        Cap gains are taxed lower because it's already taxed money being invested. In addition, it's a reward for risking your money by investing it into the economy (no, this money is not "out of circulation")
deleted 9y ago
[deleted]

80 points by blcArmadillo 9y ago

gogopuppygogo 9y ago

Trump, Trump, he's our man, if he can't do it then no one can.

sctb 9y ago
Please comment civilly and substantively or not at all. https://news.ycombinator.com/newswelcome.html https://news.ycombinator.com/newswelcome.html https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html

MichaelBurge 9y ago

> A person briefed on the plan said Ford plans to offer generous early retirement incentives to reduce its salaried headcount by Oct. 1 Why do companies offer early retirement incentives? Wouldn't it be cheaper to wait until the day(or week or month) that you'd otherwise offer them to leave on, and fire them right then without any benefits? Especially since the stated purpose of it is to save money. Ford in particular would probably get some negative PR. And since the most expensive employees are older, they might try to sue you for age discrimination. Is it just risk mitigation, or does Ford actually benefit from the incentive? 10% might be too large of a change to do all at once, especially at Ford's size; so buying them off lets them get rid of people gradually without surprising people. I can understand why executives have to be bought off: They usually negotiate an accelerated stock vesting if they get fired without cause. What about anyone below that?

EliRivers 9y ago
I know that in the old days, the long long ago, companies would sometimes act in ways that benefitted their employees out of little more than just not wanting to screw them over completely. Basically just out of niceness and decency. Maybe the people at Ford are like these old-timers who tell me about such things. Also, I know that Ford certainly used to have a solid union. I wouldn't be surprised if they have workers who can't simply be instantly fired without cause and with cancellation of all benefits. Like some kind of worker's paradise.
sebleon 9y ago
What you described is a short term savings scheme that would destroy the company's long term reputation. Who would want to work for a management team that screwed employees like that? It's hard to imagine that the cost-savings justifying the long-term consequences of losing of the best employees + candidates to competitors.
badlucklottery 9y ago
>Wouldn't it be cheaper to wait until the day(or week or month) that you'd otherwise offer them to leave on, and fire them right then without any benefits? That's a trick you can pull once. And after you do all of the skilled employees are going to be eyeing the door.
legitster 9y ago
Simple answer: Unions. They can't just layoff people without repercussions. Complex answer: Businesses that have been around this long have learned to survive by not making enemies. A tenant of this brand of capitalism is that it is cheaper to make mutually beneficial deals than to 'win'. Also, because the brand is so tied up in American identify, and many of their workers are their own consumers, they don't want to muddy the waters, especially if they expect to hire back some of the same workers again later.
- ph0rd 9y ago
  >Simple answer: Unions. They can't just layoff people without repercussions. salaried employees at ford aren't unionized, for the most part. The rest of this is correct.
Broken_Hippo 9y ago
Why do companies offer early retirement incentives? Because it is easier to reduce your workforce when folks choose to leave rather than if they go unwillingly. If you get enough reduction from this method, folks aren't as worried about their jobs. And i'm guessing in the long term, there are fewer disgruntled ex-employees. Wouldn't it be cheaper to wait until the day(or week or month) that you'd otherwise offer them to leave on, and fire them right then without any benefits? Especially since the stated purpose of it is to save money. Possibly upfront, but not in the long run. The nearly retired folks are more likely to earn more money and will likely be retiring at some point anyway so a fair amount of the costs will be happening nevertheless. From what I've seen, usually there is a decent one-time bonus and possibly earlier earning on retirement. With regular firing, unions generally require the lowest seniority folks go first. Over time, this is actually more expensive with day to day operations because these folks tend to earn the least. Plus all the hits to the employee morale.
4c2383f5c88e911 9y ago
I like how open you are about doing class warfare, but destroying the small layer of ethics carefully woven on top of your business policy isn't a good plan in the long run.
CydeWeys 9y ago
I really hope that, for your and everyone else's sake, that you are not ever in a position of management at any company, seeing as this is the way you think about running a business and treating employees.
- MichaelBurge 9y ago
  You're reading too much into the comment. I'm just looking for a list of the drawbacks. Two of the ones mentioned(unions, and long-lived stable companies depend on their reputation more than usual) hadn't occurred to me.
DanHulton 9y ago
This is potentially the most sociopathic comment I've read on this site. Here's a reason: because it's an awful thing to do.
gozur88 9y ago
It's PR, but it's also protection from legal trouble. Typically when you give some kind of severance package you require the recipient to sign away any right to sue. Also, with large companies even during layoffs they're hiring for particular skilled positions. You don't want to get the reputation as an employer which mistreats its people.

legitster 9y ago

I would recommend anyone read the book American Icon, which is about Ford's rise from the ashes in the 2000s. It's one of those thick reads, but well worth it. It's sad to see them struggling, because their car lineup has been absolutely brilliant for the last few years. But now that the industry is at it's plateau, investors are very paranoid about any car company trying to invest in new areas (Ford spent much of it's earnings on tech companies). They would rather just see dividends instead.

nvivo 9y ago
I think it's funny how we never act so selflessly in our entire lifes, but expect investors, which are people that made their career goal to be good at making more money, to suddenly grow this moral guideline and be worse at their job just for the greater good.
- icebraining 9y ago
  Such a small post, so many strange ideas: 1) That choosing investment over dividends must be a selfless act that makes one worse at their job (rather than simply a different option, possibly even more lucrative). 2) That "we" (who?) don't make life choices for selfless reasons, when it's plainly obvious that many do. 3) The idea that investors don't have a moral guideline AND that that's somehow acceptable. I didn't downvote you, by the way.
  - stupidhn 9y ago
    >That choosing investment over dividends must be a selfless act that makes one worse at their job (rather than simply a different option, possibly even more lucrative). This implies that they can't do both investing and paying dividends at the same time. What leads you to believe investment by F isn't sufficient?
    - icebraining 9y ago
      I have absolutely no opinion on the investment choices by Ford, you should ask legitster about that.

ensiferum 9y ago

If the goverment wants jobs then why don't they just do so? They have the mandate to create new regulation. They could for example say that pumping gas at the station is a job that requires training and only qualified personnel can do this job. That would instantly create new jobs and the businesses would be forced to accommodate. Hiring someone is a last recourse for any business since it's very expensive so you can't expect businesses to magically create jobs.

remline 9y ago
The concept behind sin taxes was to tax what you don't like more than what you do like. Modern governments apparently hate jobs and earned income the most.
- foota 9y ago
  How would you rather the govt tax? Seems to be a lot more efficient to tax income rather than to have separate taxes on different kinds of consumption and investment.
  - Kluny 9y ago
    As it stands, income gets higher tax than capital gains. Capital gains are taxed at half the income tax rate. So people who make most of their money on capital gains are 1) very wealthy 2) paying less tax than poorer people who rely on working for a living 3) incentivized to keep their money in investment vehicles and out of circulation. I'd suggest reversing it and taxing capital gains at the full rate and income tax at half. This is how it's done in Switzerland I believe, if you want a case study. They seem like they're doing okay.
    - christocracy 9y ago
      Cap gains are taxed lower because it's already taxed money being invested. In addition, it's a reward for risking your money by investing it into the economy (no, this money is not "out of circulation")

deleted 9y ago

[deleted]