High Gas Prices Cost 430 Ford Canada Workers Their Jobs

Ontario, Canada (AHN) - Soaring oil prices continue to hound Canadian auto makers as Ford Motor Canada announced Friday it would cut 430 jobs at its Windsor facility, which produces engines.

The manpower reduction was an offshoot of expected lower orders for pick-ups and sports utility vehicles, which consume more fuel, a direct result of oil going beyond $130 a barrel.

Ford confirmed it will soon send out lay-off notices to some of its plant workers. It is not only in Canada, but across North America, where Ford Motor would downsize by 15 percent production for the second quarter of 2008, based on 2007 second quarter figures. Another 15 percent cut was calendared for the third quarter, while for the fourth quarter Ford plans to further decrease its production by 8 percent.

Windsor is one of the hardest hit areas with 1,200 Ford employees already jobless because of the auto slump. Some of the Windsor staff may be transferred to Ford Canada's Oakville facility, which is taking in 500 workers due to the higher demand for Ford's Edge and Lincoln MKX crossover models.

Ford trails General Motors in laying off workers. Last week GM Canada said 1,400 employees would lose their jobs by mid-2010 after it shuts down its transmission plant in Windsor.

Buzz Hargrove, president of the Canadian Auto Workers, expressed hope the country's car manufacturing industry would recover in the future.

Until April, Ford Canada was still optimistic it could enjoy some profit in 2009. But that was based on projections of gas prices hovering between $3.75 to $4.25 a gallon for the next year-and-a-half. With oil prices breaching the $130 a barrel mark, the chances of even breaking even appears nil for Ford.

With a preference for larger automobiles, Ford's chances of a swift financial turnaround are lean. The automaker will produce the smaller Fiesta model for the U.S. and Canada by 2010.