Aston Martin may axe 600 jobs in cost-cutting drive

Aston Martin may cut as many as 600 jobs, the British sports car brand said today.

The possible cuts of 300 full-time jobs along with "a similar number" of temporary positions are part of a discussion between the former Ford Motor Co. subsidiary and its trade union. Aston Martin also said it's considering other undisclosed cutbacks related to worldwide economic woes and plunging sales.

"These are regrettable but necessary measures in the extraordinary market conditions we all now face," Aston Martin CEO Ulrich Bez said in a statement.

The cutbacks come as the automaker seeks to revive the Lagonda luxury brand to diversify its product mix beyond sports cars.

Julian Jenkins, CEO of Aston Martin North America, said sales fell 19 percent through the first three quarters of 2008, while the ultraluxury segment dropped 21 percent.

The Warwickshire, England-based company has 1,850 employees worldwide. The company said a 90-day consultation period had been launched with the union Unite, and that the jobs would go in the new year.

In May of last year, Ford sold Aston Martin to a group that included motorsports investors David Richards and John Sinders and two Kuwait-based investment companies. Ford took its initial stake in Aston Martin in 1987.

PRESS RELEASE: Aston Marton announces job cuts

Gaydon, 1 December 2008 - Aston Martin and its Trade Union partners have today begun consultation on a range of cutbacks to reflect the current downturn in the world economy and the corresponding fall in car sales. It is hoped to do this by minimising the impact on employees as far as possible, but the possibility of up to 300 permanent and a similar number of temporary job losses cannot be ruled out.

Aston Martin Chief Executive Officer, Dr Ulrich Bez said: "Like other premium car brands, Aston Martin has been forced to take action to respond to the unprecedented downturn in the global economy. These are regrettable but necessary measures in the extraordinary market conditions we all now face.

"Overall we remain confident that the Aston Martin brand is the strongest it has ever been - with dedicated design, engineering and manufacturing facilities and an award-winning product range, we remain well positioned for the upturn in the economy."

Ford says it might sell Volvo

Ford Motor is exploring the possible sale of Volvo Cars, the company said Monday.

The US automaker said it would "re-evaluate strategic options" for the Swedish brand.

It said its decision had been forced by the decline in the global auto industry and economic downturn.

"Given the unprecedented external challenges facing Ford and the entire industry, it is prudent for Ford to evaluate options for Volvo," said Ford President and CEO Alan Mulally in a statement.

One of the options includes the sale of Volvo, which is based in Gothenburg, Sweden.

Ford said the review likely will take several months to complete.

Until then, Ford will continue working closely with Volvo as it implements its restructuring plan under CEO Stephen Odell, who was appointed to lead Volvo in September.

"Volvo is a strong global brand with a proud heritage of safety and environmental responsibility and has launched an aggressive plan to right-size its operations and improve its financial results," said Mulally.

He added: "As we conduct this review, we are committed to making the best decision for both Ford and Volvo going forward."

Mulally said the strategic review was part of Ford's plans to make sure it has enough money to survive the current downturn.

Ford and Volvo will continue to put in place processes that allow Volvo to operate on a more stand-alone basis, Ford said.

Ford bought Volvo for 50 billion kronor ($6.45bn) in 1999 following a bidding war with Volkswagen and Fiat.

The brand was profitable at first, but, more recently, it has been in the red.

Sales slipped 13.5 percent to 295,634 units in the first nine months of 2008.

In the third quarter, Volvo's pretax losses widened to $458 million from $167 million a year ago.

In response, Volvo cut 6,000 jobs this year.

Despite this, Odell was positive about the brand's future. "Outstanding safety, an increased focus on environmentally friendly vehicles and contemporary Scandinavian design will continue to be the foundation upon which we will build a strong Volvo business for the future." he said in a statement.

He said Volvo has a strong presence in Europe, North America and the Asia Pacific region.

Said Odell: "We are growing in key markets such as China and Russia, where we are the leading premium brand."