Ford will pay out US$750 million ($719 million) to hourly workers as part of a severance deal as it winds down production at its manufacturing plant in Genk, Belgium, by the end of next year.

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Reuters reports Ford has reached a deal with the plant’s 4000 hourly workers that allows it to move forward with its plans to close the struggling factory, which currently builds the mid-sized Ford Mondeo, Ford Galaxy and Ford S-Max people-movers.

“We are pleased to have reached a social plan agreement that was accepted by the unions and approved by the hourly employees at Genk,” the plant’s operations manager, Philippe Verbeeck, said in a statement.

“We fully recognise that this has been a difficult time for everyone at the Ford Genk plant, our suppliers and the local community.”

The Genk plant is one of three European facilities Ford will close over the coming 18 months as it plans to cut production capacity in the region by 18 per cent.

The Blue Oval is forecasting losses of up to US$2 billion ($1.9 billion) in Europe this year as it continues to battle against declining demand for its vehicles stemming from the continuing economic slump.

Vehicle sales in Europe limped to their lowest levels in a quarter of a century in February.