That huge sigh of relief you hear emanating from the UK is likely the 8,300 workers at Ford's British plant in Dagenham.

As part of the company's larger development plans for the area, the Dagenham plant east of London is scheduled to undergo a $480 million revamping over a three-year span, officials from Ford Motor Co. (www.ford.com) announced. The retooling of the Dagenham plant will coincide with Ford's building a nearby supplier park, which will house component manufacturers that supply the plant. The announcement comes after work hours had been cut back in recent months at the Dagenham plant because of a dip in European sales of Ford Fiestas.

A New Ford Model
Ford's investment will create a new production line, part of an increase in the production capacity of the Dagenham plant to 300,000 units per year from 272,000.

Fifty percent of that total production capacity could be used to produce a new, and as yet undisclosed, small-car model for the European market that will be introduced at the Dagenham plant, according to Ford executives.

In making the announcement, Ford officials declined to speculate as to whether the company will decrease the Dagenham plant's production of the Fiesta, Ford's top-selling auto in the UK. The plant's peak annual production of Fiestas was about 250,000 units. "This new investment, better working practices and infrastructure improvements will make the Ford plant at Dagenham a world-class facility," Ian McAllister, Ford UK chairman and managing director, said at the announcement.

Making the Dagenham plant Ford's most modern and productive European facility, however, may mean making some changes in the work force, company officials cautioned. To date, Ford has not released specifics on what work-force changes might be implemented in the Dagenham manufacturing facility.

The Ford announcement came only after local unions agreed to changes in the work processes used in the Dagenham facility, Ford's biggest British plant. The changes, Ford officials explained, are designed to increase productivity at the plant.

Part of a Larger, $750 Million Plan
The investment in the Dagenham facility, which is located on a site Henry Ford bought in the 1920s, is part of Ford's broader, seven-year program in east London and the "Thames Gateway" area. That program, which will involve a total investment of some $750 million, will create a projected 2,000 jobs, company officials say.

Part of Ford's plans for the area includes joining with UK partners in a $354 million project to redevelop land around the Dagenham plant. Facilities located on the redeveloped acreage would include an educational campus and visitor center, according to Ford officials.

In a related development, several days after the Dagenham announcement, The European Commission gave regulatory approval to Ford's proposed acquisition of British-based Kwik-Fit Holdings, Europe's largest auto repair firm.