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Business

Ford to slash jobs in Europe amid market gloom

US auto maker Ford is planning to lay off 'several hundred' workers in its European operations to cope with overcapacity on the continent. The move comes after Ford sales dropped massively in the first half of 2012.

The planned cuts of "salaried positions" in its European workforce would be made on a voluntary basis, with workers being bought out of their contracts, Ford announced in a statement issued late on Tuesday.

"The reductions will be achieved through a combination of voluntary Ford salaried staff separations, and reductions in expenditure on agency workers and purchased services," the statement said.

The US auto maker, based in Detroit, currently employs about 66,000 workers in Europe -most of them in Germany and the United Kingdom, but also some in other countries.

As a result of the ongoing car crisis in Europe, Ford accumulated a loss of $404 million (313 million euros) in Europe in the second quarter, and expects the shortfall to widen to $1 billion by the end of the year.

In July, the company's chief executive Alan Mulally said Europe's troubles ran deeper than the current economic crisis, as the region had a serious problem with production overcapacity.

In efforts to stem its losses, Ford is considering major cost-cutting measures, including plant closures in Europe. The announced staff cuts were part of an ongoing program to achieve greater efficiencies in all areas in the current business environment, the auto maker said.

However, Ford left open how many workers it would make redundant, saying that exact figures wouldn't be known for a few months.

uhe/mz (AFP, dapd)