Ford Pays $750 Million in Severance to Workers at Genk Plant image

Ford will pay its Genk workers $750 million in severance, part of the agreement allowing the automaker to close the plant at the end of 2014.

Ford and its 4,000 hourly workers at the Genk plant reached an agreement last week, according to which the automaker can close the plant at the end of 2014, which currently manufactures the Mondeo sedan, but it has to give $750 million cash payout, which means an average $187,500 per worker. Ford also said that negotiations with the plant’s 300 salaried workers over severance have already begun.

The US automaker expects to lose around $2 billion in Europe, where the auto industry heads towards the sixth consecutive year of downturn. In October, Ford announced it will close three plants in Europe to stem losses on the continent. This means that the company will cut 18% of its capacity in the region.

Ford’s decision resulted in angry protests in Cologne, Germany, where almost 170 protesters threw fireworks at police and burned tires in front of Ford’s plant in Cologne. The company’s CEO Alan Mulally said that further capacity cuts might be made if the situation in Europe doesn’t improve.