Further Firings at Ford

Updated from 4:08 p.m. EDT

Ford (F), announced Thursday that it will cut 2,000 salaried jobs at its financing arm in North America in its latest effort to slash costs and become profitable.

The news comes just two weeks after the company said it would offer buyouts to all 75,000 of its union workers. Ford also said it would cut a total of 14,000 white collar jobs. In all, it aims to cut 44,000 positions by 2008.

Ford Motor Credit expects to consolidate 59 U.S. branches into six existing service centers by the end of 2007. A similar structure is being considered for Ford Motor Credit's operations in Canada, which currently has seven branches and one service center.

"As a company with strong business fundamentals, we believe this new structure will further strengthen our operational effectiveness," said Ford Motor Credit CEO Mike Bannister. "Our strong collections processes will continue while we enhance our originations of automotive financing contracts. The North American restructuring also will provide us with the flexibility and scale necessary to adapt to any changes in business conditions."

Since 2003, Ford Motor Credit has closed nearly 110 branches in the U.S. and Canada.

Personnel reductions will be achieved through attrition, early retirements, voluntary separations and, if necessary, involuntary separations. About 8,600 employees work in Ford Motor Credit offices in the U.S. and Canada; the region accounts for 75% of the company's global business. As of June 30, the company's global managed receivables were $151 billion.

Ford has ratcheted up the pace of its restructuring efforts to match those of its larger rival, General Motors (GM). Both automakers have fallen prey to foreign-based competitors and bloated cost structures, which has resulted in a steady erosion of their share in the key North American auto market.

Despite the difficulties, GM's shares have led the Dow Jones Industrial Average in gains this year, up 71%, as it cut its personnel levels, closed factories and sold off assets.

Shares of Ford have lagged behind -- up only 9% for the year so far -- but it recently hired a new CEO, Alan Mulally, to replace Bill Ford, the great grandson of the company's legendary founder, Henry Ford.

Ford has signaled it will sell off its Aston Martin brand, and analysts say more asset sales will follow. Meanwhile, the automaker could be in line to discuss a global alliance with Nissan and Renault if those companies break off talks with GM.

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