Ford's four-day week

Ford has become the latest major car manufacturer to cut production in Britain as the global financial crisis begins to engulf the European motor industry.

Workers at the Ford Transit factory in Southampton will now work a four-day week until the end of the year.

It means 17 fewer days of production at the plant - all part of an effort to avoid stockpiling vehicles that aren't selling.

The Transit is the only vehicle that Ford builds in the UK. As we've previously reported, there's been speculation about the Southampton factory's future for some time. Some Transit production has already moved to Ford's Turkish factory, where costs are cheaper.

Today Ford of Europe announced that it expects profits to drop in the second-half of the year due to rising raw material costs and a cut in demand for new vehicles.

Car buying in the UK has slowed in part because the financial crunch has led to a shortage in the availability of credit for new cars in Britain.

After plunging car sales were announced in August, most car manufacturers have been winding back production in factories throughout the UK and Europe, fearing worsening results in months to come.

Toyota has already suspended the night shift at Derby where the Auris and the Avensis are made. Meanwhile, Jaguar and Land Rover has cut Friday production at Halewood, with staff having 'training days' instead.

Bentley has switched its Crewe factory to a three-day week, and Aston Martin revealed that it only sold 19 cars during the whole of August.

No job losses have been announced at any UK factories. But analysts predict that it could only be a matter of time if the current market turmoil persists.

Elsewhere in Europe, Mercedes-Benz and BMW will trim production by around 25,000 cars in the last three months of 2008.

Spain stands to lose 1300 Ford and 600 General Motors jobs, as the two big American car makers cut production. Spain's domestic manufacturer Seat intends to reduce Altea and Leon production by 300 cars per day.

Production of the Fiat Punto, Lancia Ypsilon and most Alfa Romeos will be scaled back by idling Italian factories in September, October and November.

Struggling Ford-subsidiary Volvo plans to drop the night shift at Gothenburg, Sweden. And the slow-selling Renault Laguna is forcing major cut backs at French factories too.

Part of the reason for the drastic cuts, analysts suggest, is that manufactures refused to face up to slowing sales earlier in the first half of the year, and pumped out vehicles regardless.