UPDATE: Ford to transfer UK plant to Turkey

Ford employees stand outside the factory after the announcement of the loss of over 4,000 jobs due to the closure of the plant on October 24, 2012 in Genk, Belgium.

Ford has announced this morning the closure of its last vehicle manufacturing plant in the UK. The company is reportedly shutting down a van factory and shifting production to Turkey. The move comes just one day after news that Ford is closing a plant in Belgium.

The closures will be a bitter blow to the communities where the two factories are based. At least 1300 jobs will go in the UK and more than 4,000 in Belgium, but the news is not a surprise. The debt crisis and the faltering European economy have taken their toll. The market for vehicles in Spain has shrunk by a third -- in Greece and Portugal it’s down by 40 percent.

Ford is on course to lose more than a billion dollars in Europe this year, so the company is bowing to the inevitable. Peter Wells, with the Centre for Automotive Research, says, "Ford has recognized that there is a deep structural shift going on in Europe in terms of the market and the level of demand which means they simply have surplus capacity."

The company is shifting some of its van production to its plant in Turkey -- there the  wages are lower and the factory is closer to the potentially higher growth markets of Eastern Europe and the Middle East.

About the author

Stephen Beard is the European bureau chief and provides daily coverage of Europe’s business and economic developments for the entire Marketplace portfolio.

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