Ford Motor Company Is Making Record Profits – By Shipping Our Jobs Overseas

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On Tuesday, Ford Motor Company reported a record breaking profit for the third quarter.  Ford earned 1.7 billion dollars during the quarter, which was way up from a profit of $997 million a year ago during the same time period.  Ford CEO Alan Mulally is being hailed as a miracle worker, and investors are giddy about the future of the company.  So is all of this success by Ford translating into good jobs for American workers?  No.  As described in a recent article on MSNBC, Mulally has been “revamping Ford’s U.S. and global manufacturing operation to be cheaper, more efficient and more flexible”.  In other words, Mulally has been getting rid of American workers in droves.  Since Mulally took over as CEO, Ford has slashed its North American work force by nearly half.  Ford has shut down or plans to shut down a dozen U.S. manufacturing facilities.  Today, only about 40 percent of Ford’s 178,000 workers are employed in North America, and a lot of those jobs are in Canada and Mexico.  In fact, the number of Ford cars produced in Mexico continues to grow rapidly.  The truth is that this is yet another example that proves that what is good for Wall Street is not necessarily good for average American workers.


Today, the average Mexican auto worker makes less than a tenth of what a U.S. auto worker makes in total compensation.  In the new global economy, good jobs are going to where the labor is the cheapest, and that means going away from American workers.

Even the unionized workers that remained at the manufacturing facilities that Ford kept open were forced to agree to very substantial concessions to their labor contracts just to keep their jobs.

Meanwhile, literally hundreds of Ford dealerships have been shut down from coast to coast.  All of this “dealership downsizing” has also come at a very high price – thousands of good American jobs.

So should we be celebrating record profits at Ford?

Not really.

The truth is that in the pursuit of profits, Ford has devastated quite a few local communities.

For example,  Ford recently announced the closure of a facility that produces the Ford Ranger in St. Paul, Minnesota. 

Closing that plant eliminates 750 U.S. jobs.

But don’t people still want to buy Ford Rangers?

Yes, of course Ford Rangers are still quite popular, and Minnesota desperately wanted to keep that factory open.

In fact, Minnesota Governor Tim Pawlenty offered Ford a very generous multi-million dollar incentive package full of tax cuts and job creation incentives to keep the factory open.

But it didn’t work.

Ford closed the factory anyway.

So where are all of those Ford Rangers going to be manufactured now?

Well, the statement about the plant closing issued by Ford did not reveal that tidbit, but it did offer some clues….

“Ford continues to concentrate on implementing the plan we initiated four years ago to streamline our plant operations and better leverage our global platforms. At this time, the Twin Cities Assembly Plant does not fit into our global manufacturing strategy.”

When you see big corporations like Ford use the word “global”, what it really means is some place other than America.

So don’t be too quick to applaud Ford for record breaking profits.

The truth is that if current trends continue, we are going to end up with literally tens of millions of unemployed American workers.

We are shipping factories, jobs and wealth overseas so rapidly that it is hard to even comprehend what is going on.

In 1985, the U.S. trade deficit with China was 6 million dollars for the entire year.  In the month of August alone, the U.S. trade deficit with China was over 28 billion dollars.

Just think about that for a minute.

World trade has been completely and totally revolutionized over the past 25 years, and America is losing.

The United States has lost approximately 42,400 factories since 2001.

So how many more are we going to lose before our “leaders” do something about it?

As of the end of 2009, less than 12 million Americans worked in manufacturing.  The last time less than 12 million Americans were employed in manufacturing was in 1941.

The sad truth is that the United States is being deindustrialized.  The big global corporations have figured out that they don’t really need American workers anymore, and that is really, really bad news for the American middle class.

Without good paying jobs, the future of the middle class is incredibly bleak.

If you think that you have figured out how the U.S. middle class is going to be able to thrive without good jobs, please leave a comment below and tell me why I am wrong….

  • srhardy

    Our car industry so very small in Australia but we have the same problem as the US in that Asian car companies can name high quality cars very cheap! In Europe the manufacturing is all going to Eastern Europe to the same high standards that sells brands like VW from German factories.

    Now were starting to get cars here from china & to be honest they are about as good as cars were from Korea were a decade ago (ie, not good at all) but they are getting better FAST & they are investing heavily in next gen alt energy cars that will leapfrog everyone for several reasons. 1 they have the rare earth elements to make things & no one else does, 2 they can do things on a scale that isnt even possible in a populous country like America and they will just keep getting better & better.

    I don’t see us having a car industry in a decade, maybe a small boutique one (large rear wheel drive sedans maybe?) but we will go like NZ who just import & don’t have to subsidize a car industry because here the dirty little secret, they don’t build cars, they collect welfare from YOU THE TAXPAYER and have for decades now.

    If we gave everyone the subsidy here in Australia instead of top the car industry everyone would get >$2000 cash for a car every year!

    Its insane!

    So you ask, were do the jobs come from? Well if you have HUGE tariffs maybe for $3 someone will rickshaw you around for 15min? The reason is fuel will cost a gizzilion dollars from tariffs others will place on you.

    Again not good. I don’t know what is but i know tariffs are BAD (evil) and evey other idea you think up will just make things worse…

  • srhardy




  • Justa Guy

    Yeah, this guy’s a real genius. Rent-a-slave vs. pay-a-worker. Hmmm, I guess its time to sell out the American people again. At this point, if I ever have any disposable income again (which is looking increasingly less likely anytime soon), I will not buy a Ford, I will buy foreign. I would rather give the money to another country than to reward this guy by making him incredibly wealthy for jettisoning the American worker. Hey, there’s an idea to fight back against these people….if you can’t get a product made in USA, then at least buy from the non-American company. At least you won’t be making the American executive theives rich. Start making them feel the pain too.

  • Bruce K

    I see it differently… Ford (and GM and Chrysler) struggled to compete for decades because of union greed. Now they have finally seen the light… that the unions were choking their ability to compete in the marketplace. If you don’t see that, you are blind. The unions had hundreds of thousands of barely literate people making 75k and up on the manufacturing line. That was clearly unsustainable.

    So now they are doing something about it, which includes cutting their labor costs by using labor in Canada and Mexico. I’m all for it, the greedy unions can go cry in their beer. This is business, not welfare.

    Hey, at least they are using labor near us… I’d much rather see Mexico have the factories than China or Korea… at least then there are some reasons to stay in Mexico and work instead of coming here.

  • xander cross

    Ah yes, the free market strikes again at the expense of the american worker. I see what the average american thinking about now “let’s go to wal-mart, where it’s cheap”. “what do you mean I got laid off? (the boss) well, we found someone that can do your job for cheaper, like 86 cents a day than paying you $10.00 an hour.

    Welcome to the free market (at your expense).

  • mondobeyondo

    The Mexican worker making those Ford Rangers and F-350’s must be in hog heaven. He’ll be able to afford some tortillas to feed his family, and a brand new space heater for his cold apartment this winter. With overtime, he might even purchase a new 13 inch flatscreen TV for Christmas! Que bueno!!

    His (former) American equivalent, on the other hand, will be using food stamps at the local Walmart so he can feed his family.

    Fair trade? Free trade? Yeah, right. You should have listened to Ross Perot 18 years ago. Turns out he was right!

  • Gary

    Tax the hell out of ford. Hi Tariffs!

  • Gary

    Michael-if you can somehow link this site with your much more popular economic collapse site you may get more viewers on this site. Just a suggestion.

  • I live in Detroit. Well over five years ago, I could see the writing on the wall. The auto industry related jobs were disappearing. I tried to warn my friends. Most of their responses were something like, “Oh, it will turn around in a few years”. I never argued with them. All I said was “How?”. Funny thing is than no one could ever answer my question.

    You are not wrong. We in America are on the express train to becoming a third world country. All the sheeple on that train are just saying “baaaa”.

  • Sherman Peabody

    Japanese car makers in the US have all of their sub-assemblies made in China, Korea, etc then the parts are put together in non labor union Southern States. If Ford doesn’t source the same cheap parts they will go under.

  • The TRUTH

    Industrial middle class jobs will continue to leave until we stop importing. It’s as simple as that. Unions make US labor incredibly expensive so companies will do what they do. Our governemtn needs to tear up Nafta and stop importing so much stuff. Foriegn Auto manufactors should not be allowed to sell in America unless it was built in America. Period.