Knight Ridder Newspapers

DETROIT – While the nation has been preoccupied with the struggles of General Motors Corp., Tuesday’s announcement of white-collar job and benefit cuts at Ford Motor Co. shows that the two rivals are fundamentally in the same boat.

Late Tuesday, Ford announced plans to eliminate 1,700 salaried positions by Oct. 1, suspend contributions to 401(k) retirement accounts and eliminate management bonuses for the year.

The moves announced Tuesday were widely seen as an effort to woo the union by demonstrating that salaried employees would share the pain. Then the union might be willing to give Ford the same cost-saving agreements it is currently discussing with rival GM.

“Ford also took the opportunity Tuesday to make a very clear (in our view) announcement to the UAW, that if any health care concessions are on the table, Ford wants some, too. … In keeping with” UAW President Ron Gettelfinger’s “suggestion that if the union is going to play ball, that everyone should have some skin in the game,” Chris Ceraso, who studies the industry for investors at Credit Suisse First Boston, said in a note. A spokesman said the union had no comment on that idea.

Just last month, Ford reached an agreement with the UAW over the transfer of Visteon plants back to Ford, which could be seen as a sign of their cooperative relationship.

To fix its U.S. business, GM has said it is trying to work with the UAW to reduce health-care inflation, but hinted that it may have to take some actions with or without the union’s consent. The UAW has said it will cooperate within the current four-year contract, but warned GM not to act unilaterally.

The world’s largest automaker said last month that it would eliminate 25,000 U.S. manufacturing jobs over four years.

Besides announcing its own personnel cuts Tuesday, Ford said it would make less profit this year than it previously expected.

Its stock dropped 4.4 percent on Wednesday, dragging down Michigan suppliers – and GM, too.