Ford investment in Wales is to be reduced. Production of its new generation of petrol engines in Bridgend is to be cut by half. A planned investment of £181 million is to be cut to £100 million. There are 1,850 jobs at stake although Ford has stated that no jobs are planned to be lost. However, the trade union Unite stated that it is deeply concerned and that Ford’s long-term commitment to the Bridgend plant is under question.
This decision comes two years before production is due to commence in 2018. The plan is to build 250,000 new engines. It also comes almost a year after the deal was initially announced with safeguards given for over 750 jobs ‘for many years’. The Welsh government backed the deal with almost £15 million. It was won by Wales against competition from other EU countries: Germany Romania and Spain.
Ford has now announced that its investment would be just £100 million rather than the planned £181 million, and the number of engines involved will be cut by half to just 125,000. It also stated that it requires only 550 of the initial 750 staff for the new production line. The remainder, however, would be employed elsewhere in the Ford Bridgend plant.
A Ford spokesman stated that the changes are due to the success of alternative engine and automotive technology and to an anticipated reduction in demand from Europe and other world markets. Of particular success is Ford’s EcoBoost 1 litre petrol engine. This changes the company’s perspective on the engines to be built in the Bridgend plant.
In the announcement, Ford states that the flexibility of the Bridgend plant enables it to make rapid adjustments according to marketing requirements, and that is was able to scale production up or down according to demand.
According to the Unite Trade Union secretary, Andy Richards, the plant is in a ‘very dangerous situation’. He stated that pre-planned reductions in other areas of the plant, including the 50% reduction in new engine (named the Dragon engine after the Welsh dragon flag) are worrying. He believes that there is a long-term plan to dismantle and ultimately close the plant. The engines are manufactured in Wales for cars assembled outside the UK.
As Andy Richards infers, decisions such as these do not come out of the blue. They result from board meetings and long-term plans. It is possible that the Welsh plant may not be part of these plans. That is the union view. The Unite union had a meeting with Ford representatives and the Welsh government on Tuesday.
Ford’s Bridgend plant has been in production since 1980. Its contract with Jaguar Land Rover to produce 250,000 engines a year finishes in 2018. According to Ford, it is still committed to the Bridgend plant. The Unite trade union has difficulty in believing this.
The future of Ford investment in Wales, or even the entire UK, seems to many to be tenuous. Many believe this to be the first step in ramping down its manufacturing facilities within the UK in view of the Brexit vote. Many US companies feel that the UK is a good entry to the EU market. When the UK leaves the EU this market may be reduced or even lost and have to be renegotiated.
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