04:48 PM CST on Friday, December 2, 2005

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KMOV

DETROIT (AP) -- Ford Motor Co. is likely to close five North American plants as part of a still-evolving restructuring plan to be announced next month, according to a newspaper report published Friday.

While the plan is still being formulated and is subject to change, The Wall Street Journal reported that that nation's second biggest automaker is likely to close assembly plants in St. Louis, Atlanta and St. Paul, Minn. It cited two unidentified people familiar with the automaker's product plans.

Hazelwood Mayor T.R. Carr learned the bad news when a reporter called his home at 4:30 a.m. Friday.

But Carr has been through this plenty of times over the past few years. The plant, which makes Ford Explorer, Mercury Mountaineer and Lincoln Aviator sport utility vehicles, has often been rumored to be on the chopping block.

"To some extent, this kind of speculation is normal business around here," Carr said. "Ford has always made a commitment to us they would notify the governor and the city of Hazelwood prior to any formal announcement. We tend not to respond to rumors and speculation."

The Wall Street Journal, citing two unidentified people familiar with the automaker's plans, said Ford is likely to close five North American plants, including Hazelwood. A Ford spokesman would say only that the company has excess capacity and an announcement will be made in January.

The closings would eliminate 7,500 jobs, or 6 percent of Ford's North American work force.

The news came one day after Ford said sales of its Ford, Lincoln and Mercury brands fell 18 percent in November. SUV sales are expected to close the year at the lowest annual sales level since the line was introduced 15 years ago.

In Hazelwood, the speculation is concerning considering the approximate 1,400 union workers there earn, on average, nearly $65,000 annually with overtime. The average Missourian earns about half that.

There was no answer at the United Auto Workers Local 325 office in Hazelwood. A spokesman for Gov. Matt Blunt did not return phone calls seeking comment.

In 2002, Ford announced plans to close the Hazelwood plant. But then-Gov. Bob Holden appointed a task force that helped convince Ford to keep the plant open, at least through 2007. In return, Ford received $9 million in state incentives and $8 million in local tax abatements.

In a joint statement, Gov. Matt Blunt and Missouri Department of Economic Development Director Greg Steinhoff said they remain committed to keeping the Hazelwood plant open.

"While we understand that these are difficult times for the auto industry and are aware of Ford's previous decisions regarding the Hazelwood facility, we will continue working with company and local officials on behalf of Ford employees in Missouri," the statement read.

Still, declining sales of SUVs prompted Ford to shut down one of the plant's two shifts in December 2004, leaving 800 people out of work.

Carr said city and state officials have asked Ford to make the Hazelwood plant a flexible one that can eventually switch to another product line.

"We know the domestic auto industry is under stress," the mayor said. "We also know the life of the Explorer product line is coming to an end of its cycle."

Carr said the obituary for the Hazelwood plant has been written plenty of times, but the plant has survived.

"I can't count the number of times the story would break that Hazelwood would be gone by 2005, and it didn't happen," he said. "It (shutdown of the plant) is not written in stone."

Hazelwood has already been hurt this month by restructuring from an automaker. General Motors Corp.'s plan to cut 30,000 jobs included cutbacks at a distribution center in Hazelwood that employs 65 workers, though GM said it will open a smaller center nearby that will hire at least some of the Hazelwood employees.

GM did not cut any jobs at its assembly plant in Wentzville, near St. Louis, which employs 2,600 people.

DaimlerChrysler also operates two plants in the St. Louis area.

Ford Chairman and CEO Bill Ford has said he plans to announce U.S. plant closings and layoffs in January.

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On the Net:

Ford Motor Co.: http://www.ford.com