Ford closing St. Paul plant?

Officials from Ford Motor Company, the unions and local government officials railed against a Wall Street Journal report today in which unnamed sources claim that the St. Paul Ranger plant is one of five North American plants tagged for closure by officials in Detroit.

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

The newspaper said an engine-parts plant in Windsor, Ontario, and a truck-assembly plant in Cuautitlan, Mexico, are also slated for closure. Together, the plants employ about 7,500 workers, or 6 percent of Ford's North American work force.

The Highland Park plant in St. Paul employs about 2,000 people who make the Ranger light pickup truck for the North American market. It is the seventh largest private sector employer in St. Paul.

The report sent Minnesota officials reaching for the phone and soured the mood of union officials who insisted the news was at premature at best or simply dead wrong.

"This is not the definitive decision. That is not the current status of the restructuring agreements," said Rob McKenzie, president of UAW Local 879. "I think that is an old story that somebody who was pretty far removed from the decision making process leaked out for some reason. For some reason they are mad."

The plant has been operating below capacity as sales of the pickups have been falling. During the first seven months of 2005, it was idled for 12 weeks.

Bill Rooney, Ford's human resources manager in St. Paul, insisted that the Journal published "a speculative report. We have been told [by Detroit] that we will be informed in January [about any plant closings nationally]. ...Until then we are sitting tight and producing the highest quality pickups in America."

Minnesota's Commissioner of Employment and Economic Development, Matt Kramer, said he spoke with a Ford official this morning about the report that the St. Paul facility is targeted for closure.

He said Ford has promised to notify him in advance of any public announcement regarding the St. Paul plant -- and he doesn't expect that to happen until January. Asked whether he has been given notice that such an announcement is pending, Kramer said, "none whatsoever."

"Obviously, we've indicated we will address our excess capacity," Ford spokesman Oscar Suris told The Associated Press today. "We've been pretty consistent in saying we'll share these plans in more detail in January. Nothing is finalized."

The report comes a day after Ford said sales of its Ford, Lincoln and Mercury brands fell 18 percent in November, and it said it would produce 2.5 percent fewer vehicles in North America in the first quarter than it did last year.

The January restructuring plan will be the latest in a series of shake-ups and cost-cutting moves at the Dearborn-based automaker, which reported a third-quarter loss of $284 million. In North America, it lost $1.2 billion before taxes.

When the company announced the third-quarter results in October, Bill Ford said he planned to complete the restructuring plan in December and announce it in January.

Gov. Pawlenty and legislators rally

Gov. Tim Pawlenty sent a letter Friday to Ford Motor Company President and CEO Bill Ford proposing that the company work with the state of Minnesota to build a center for renewable fuels in St. Paul. Minnesota leads the nation in use of such fuels as ethanol, biodiesel, wind, biomass and hydrogen cells. The center would contribute to Ford's plans to lead the nation in the production of flexible and renewable fuel vehicles.

Said House Speaker Steve Sviggum, R-Kenyon, suggested that the situation could warrant a special session of the Legislature for action such as designating the plant a tax-free zone.

"We would do everything we could within reason to keep those jobs here," he said. "This is very negative news for Minnesota."

Senate Majority Leader Dean Johnson, DFL-Willmar, said this is not the first time the St. Paul plant has been on the company's closure list. He urged Pawlenty to engage Ford's top executives to find a way to keep the plant open, perhaps making new-generation hybrid vehicles.

If the plant closes, he added, "We'd feel it."

St. Paul would fight for the plant

In St. Paul, local officials are scrambling to do what they can to convince Ford of the necessity of keeping the St. Paul plant open, including its value in producing more fuel-efficient vehicles using ethanol.

"Manufacturing jobs are critical to St. Paul," said Ken Johnson, Port Authority President, in a statement. Johnson said he believes a majority of the workers live in the city.

"These are high quality jobs and are very difficult to replace in the St. Paul economy," he said.

Mayor-elect Chris Coleman issued a statement cautioning about "premature" speculation on the future of the Ford plant, but said he will work with government officials, union leaders and Ford executives "to show that St. Paul is eager to find a solution that keeps the plant open." Coleman participated in a recent conference call with Ford officials along with U.S. Sen. Norm Coleman and Gov. Tim Pawlenty.

"Ultimately the fate of the plant depends on executives at Ford, but we have been assured we will have a voice in the process," Coleman said.

A spokesman for Kelly, who is in Nagasaki, Japan, said the city has been involved in ongoing discussions for more than a year talking about ways to keep open the plant.

"It definitely hasn't been an 'asleep at the wheel' kind of thing," said Carl Kuhl, Kelly's communications director. "In the end, it's a decision the company's got to make."

Ford shares rose 2 cents to $8.12 in morning trading on the New York Stock Exchange, but is closer to the lower end of its 52-week range of $7.57 to $15.

The Wall Street Journal and Associated Press contributed to this report.