Summary
Ford Motor Company announced plans to exit its Bridgend Engine Plant in South Wales, a significant operational restructuring move impacting its UK operations. This decision, subject to employee consultations, is slated for completion in 2020. The company anticipates recording substantial pre-tax special item charges related to this exit, estimated at approximately $650 million. This figure includes both cash and non-cash components, with the majority of charges expected in 2019 and cash outflows primarily in 2020.
Key Highlights
- 1Ford plans to cease production at the Bridgend Engine Plant in South Wales by 2020.
- 2The exit is subject to consultation with employees.
- 3Ford expects to record pre-tax special item charges of approximately $650 million.
- 4Approximately $400 million of the charges will be paid in cash, mainly for employee separation and termination.
- 5Non-cash charges of about $250 million are related to pension expense and accelerated depreciation/amortization.
- 6Most of the charges are expected to be recognized in the 2019 fiscal year.
- 7Most of the cash outflows associated with the exit are anticipated in 2020.
Frequently Asked Questions
Ford Motor Company announced its plan to exit the Ford Bridgend Engine Plant in South Wales, indicating a restructuring of its manufacturing operations.
Ford anticipates recording pre-tax special item charges of approximately $650 million, consisting of both cash (around $400 million) and non-cash (around $250 million) expenses.
Most of the pre-tax special item charges are expected to be recorded in 2019, while the majority of the cash outflows related to employee payments will occur in 2020.
Yes, the plan is subject to consultation with employees, and a significant portion of the cash charges ($400 million) is attributed to separation and termination payments for employees.