August 21, 2007 at 11:22 am

Success will mean little if U.S. plans fail

SÃO BERNARDO DO CAMPO, Brazil -- Silvio Illi would seem to have little to worry about as he walks the line at Ford Motor Co.'s São Bernardo plant outside São Paulo.

He manages a factory that -- even running at full capacity -- can barely keep up with demand for its cars and trucks. Better still, Ford is investing heavily in Illi's plant as it prepares to begin production of a new model.

But Illi cannot help but be concerned about what is going on half a world away in Dearborn. He knows Ford is struggling to save its North American automotive business. He knows the company has mortgaged everything to finance its turnaround plan. And while the success of a similar restructuring effort in Brazil gives him hope, Illi knows the efforts he and his team have made to revive Ford's South American business will not matter much if the plan fails in the United States.

"This is an American company, and it is cutting jobs in the U.S.A. and putting more here," Illi said. "People understand that is only because we are making money. It is a big responsibility. It makes people want to keep it up."

For employees of Ford and General Motors Corp. in South America, Detroit's problems hit close to home. Though both companies are booking record profits in the region, everyone from top executives to rank-and-file workers know that their ultimate success depends on the automakers' ability to fix their struggling North American operations.

"We are aware of the situation there," said Pedro Luiz Dias, vice president of communications for GM do Brasil. "People know what is going on."

People such as union leader José Lopez Feijóo. As head of Brazil's autoworkers union, he has traveled to the United States and seen firsthand the challenges facing the U.S. automakers on their home turf.

"The last time I was in Detroit, I was very depressed to see the Rouge Plant -- how empty it was," he said. "Detroit seemed to me to be a ghost city."

Feijóo says he feels strong solidarity with autoworkers in the United States, but adds that labor and management have to work to overcome the challenges the two companies face there, just as they have in Brazil.

"We need to find a solution," he said. "Anything that happens in the U.S. automatically impacts us here."

A thousand miles to the south, in the Argentine town of General Pacheco, just outside Buenos Aires, Roberto Ponti is also watching developments in Detroit.

The 46-year-old quality inspector has spent 27 years working at Ford's Pacheco Assembly Plant, where the Ford Focus compact and Ranger pickup are built, and he says the automaker has had to overcome similar challenges in his country.

"I know what they are facing," Ponti said, adding that he hopes Ford's problems in North America will not force the company to close its operations in Argentina. "We worry about that here."

Nor are employees of Ford and GM the only ones concerned about the fate of U.S. automakers in South America. Dealers are also anxious to see both companies' restructuring efforts succeed.

Ernesto Geraldi owns a number of automotive dealerships in São Paulo, including several Ford stores.

"It's logical to be worried," he said. "(But) I'm sure that Ford and GM are so strong, so famous, so important -- they are going to choose good plans to make the turnaround."