MPs claim Visteon 'set up to fail' by Ford

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MPs have demanded Ford compensates former employees who suffered pension losses after the collapse of Visteon and claim the manufacturer set up the spin-off firm to fail.

In an open letter to carmaker's chief executive, Alan Mulally, the All Party Parliamentary Group in Support of Visteon Pensioners called on the firm to honour its "moral responsibilities".

The group, led by Conservative MP Stephen Metcalfe, said former employees believed they were misled by Ford when they transferred out of its scheme when Visteon was spun off in 2000.

The firm, which manufactured parts for Ford, collapsed in 2009 and its scheme, which was £350m in deficit, entered the Pension Protection Fund resulting in reduced pensions for members.

Metcalfe said: "My constituents believe that Ford should make up the shortfall in their pensions, especially in light of the fact that there are still a number of main board directors serving today who would have been involved in the original spin off."

He also alleged that Visteon was "set up to fail" by Ford as part of a move to dispose of its parts manufacturing arm to cut costs.

He quoted Visteon Corporation chief executive Tim Leuliette, who said that the firm did not have a chance of staying in business from the moment it was spun off.

Leuliette said: "The labour cost issues, and the burden and the overheads were just so out of line with the reality that it was almost comical. It just wasn't going to work. And it didn't work."

Metcalfe added that Visteon's US employees had remained in the Ford scheme, an option which many UK workers would have chosen.

In today's letter, Metcalfe also extended an open invitation to the company, which had declined send representatives to meet MPs earlier this month, to discuss Visteon.

Of the letter Metcalfe said: "Members of the APPG believe that Ford has a moral responsibility to compensate the financial losses of the pensioners, hence we have written the open letter to publicly highlight our concerns and to call on Ford to meet its obligations."

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