Ford to close Hazelwood plant

HAZELWOOD, Mo. -- Even in this industrial north St. Louis County town, the Ford Motor Co. plant is known simply as "Hazelwood."

Hazelwood's identity has been intertwined with the factory since it opened in 1948, said resident Ken McGhee, who owns a funeral home across from the plant.

"That was kind of one of those prideful things, to be able to look at the Ford plant ...," McGhee said.

That pride was deeply shaken Monday when Ford announced it would idle the plant. Employees were told production will cease March 10. The move leaves 1,400 union workers unemployed and cuts $1.5 million in annual tax revenue for this north St. Louis suburb.

The No. 2 U.S. automaker lost $1.6 billion in its North American operations last year. Officials announced a restructuring plan dubbed the "Way Forward" Monday morning.

Overall, 14 North American plants will be idled, with 25,000 to 30,000 workers losing their jobs. The company is using the term "idle" because equipment will not immediately be removed from the plants. Officials in the St. Louis area say the phrase offers some hope of a reprieve.

"It is not closed, it is idled," St. Louis County executive Charlie Dooley said. "That means we still have an opportunity to do the right thing."

Some employees weren't giving up hope, either.

"This plant has seen two other cases where we were going to be shut down, and in the 11th hour we were saved," said Rich Repmann, who has worked at the factory for 40 years.

Workers drank beer and smoked cigarettes at the United Auto Workers Local 325 hall Monday, trading gossip and wondering what they'll do next.

"I think they'll wind up making some sort of deal with the state," said Gary Browning, a 10-year employee.

Ford nearly shut down the facility three years ago before a group of lawmakers and civic leaders convinced the company to keep it open. But with SUV sales declining, Ford shuttered the second shift of the Hazelwood plant in September 2004, eliminating about 800 jobs.

Even though the shutdown had been rumored for some time, the news hit workers hard, said Ken Dearing, president of the UAW local.

"Their hopes and dreams and aspirations and secure future are gone for now," Dearing said.

Officials said they will continue the fight to save the plant.

Gov. Matt Blunt said the state will consider "responsible" financial incentives, but did not elaborate.

"We're not going to give up on those employees at Hazelwood, and we're going to continue to make the case that Ford needs to have a presence in the state of Missouri," Blunt said.

The automaker has been hurt by falling sales of its sport utility vehicles, growing health care and materials costs, and labor contracts that have limited its ability to close plants and cut jobs. The UAW will have to agree to some of the changes Ford wants to make.

The Hazelwood plant makes the Ford Explorer SUV, a product that has seen its customer base drop dramatically. A Ford plant in Louisville, Ky., will continue to make the Explorer, whose sales dropped 30 percent over the first 11 months of 2005 due in part to rising fuel costs.

Ford also makes the Mercury Mountaineer in Hazelwood.

Blunt, Dooley, Hazelwood Mayor T.R. Carr and others flew to Ford's headquarters in Dearborn, Mich., this month to ask the company to spare the plant.

Carr said the group presented a number of options to Ford, such as using the plant to build next-generation hybrid cars or turning it into a "flex-plant" that could build different cars as needed.

David Cole, chairman of the Center for Automotive Research in Ann Arbor, Mich., said it's unlikely Ford would make big investments now to retool plants because the company has limited money to spend.

"I think Ford views this as 'change or die,' frankly. It's a very serious effort," Cole said.

Hazelwood depends on a heavy manufacturing base for many high-paying jobs. The average autoworker at the Ford plant earns nearly $65,000 with overtime. The average Missourian earns about half that.

Ford reported Monday before the restructuring announcement that it earned $124 million in the fourth quarter, up 19 percent from the previous year thanks to the sale of its Hertz Corp. rental division and improved profits for its luxury brands. Its profit for the year fell 42 percent to $2 billion.

The company suffered its 10th straight year of market share losses in the United States in 2005, and for the first time in 19 years, Ford lost its crown as America's best-selling brand to General Motors Corp.'s Chevrolet.

The loss of the Ford plant comes at a time when General Motors Corp. and DaimlerChrysler are expanding their St. Louis-area plants, thanks in part to financial incentives.

GM makes full-sized vans in Wentzville; DaimlerChrysler makes minivans and pickup trucks in Fenton.