Ford takes writedown on PGM stockpile

Ford, the world’s second-largest automaker, has taken a US$1-billion writedown on its inventory of platinum group metals used in catalytic converters. The measure is part of an overall US$5.7-billion pretax writedown in the company’s fourth quarter.

The auto giant was caught by a steep fall in PGM prices, which fell to about US$400 in December 2001 from record highs of about US$1,100 in January. At the same time, Ford found ways of using lesser amounts of PGMs in catalytic converters, which are used to reduce pollutants from tailpipe gasses.

The company has not stated how much platinum and palladium it has in its inventory, though reportedly paid as much US$1,500 per oz.

Also, Ford says it will close seven plants worldwide and lay off 35,000 employees as a part of a US$9-billion turnaround plan.