DETROIT (AP) — Ford’s hourly work force is shrinking to half its current size, following the announcement yesterday that 38,000 hourly workers have agreed to accept early retirement or buyout packages this year.That still might not be enough to revive the nation’s second-largest automaker, however, which is contracting in the face of multibillion-dollar losses and fierce competition. Now, say analysts, Ford Motor Co. needs to rekindle interest in its cars and reclaim some market share lost to Asian rivals.

“They’ve got to learn how to build a product that is acceptable in the market at a good price,” Turnaround specialist Jim McTevia, of McTevia & Associates in Bingham Farms, said. “They’ve got to build it economically and they’ve got to sell it economically.”

Ford had expected 25,000 to 30,000 workers to sign up during an open enrollment period that expired on Monday. The new reduction figure would amount to nearly 46 percent of the 83,000 unionized employees that Ford had at the start of the year.

That will eventually save Ford about $5 billion a year, but it still has a long way to go and more painful measures to take before it’s financially sound.

Ford lost $7 billion in the first nine months of the year. And it is losing money on a daily basis. The Dearborn-based automaker said yesterday it expects to burn through $17 billion in cash from 2007 to 2009.

On Monday, it announced plans to mortgage its assets and raise about $18 billion in financing to pay for its restructuring.

McTevia said that move and the buyout figures signal that the automaker believes it will be able to operate profitably in the future. Ford has said it expects to return to profitability by 2009.

But McTevia said Ford faces stiff competition from companies on much stronger financial footing. Ford’s share of the domestic market has declined from around 26 percent in the early 1990s to 17.6 percent at the end of October. In July, Ford sold fewer vehicles in the US than Toyota Motor Corp. for the first time, but Ford’s US sales have surpassed the Japanese company since then.

Pete Hastings, vice president of corporate fixed income at Morgan Keegan in Memphis, Tennessee, said the buyout announcement “represents one step among many on a long road” to Ford’s turnaround. He said the automaker still must address its lost market share and structural costs when it renegotiates with the United Auto Workers next fall.

“They’ll probably need another round of restructuring to adjust to the lower capacity from falling market share,” Hastings said.

“They face tremendous challenges. It’s going to be tough for them to achieve the turnaround. It’s certainly a multiyear process, and I’m sure we’ll see plenty of changes in the upcoming months.”

As for the current round of buyouts, while workers can change their minds and back out of the deals, company officials predicted only a single-digit percentage would do so before their package takes effect.

Those who accepted the buyout packages will begin to leave the company in January, with the window open until September 1, 2007, the company said.

At the Ford Rouge plant in Dearborn, yesterday, Vivian Davis said she’s thrilled to be among those taking an early retirement incentive.

“I was two years away anyway, so this is just helping me out,” said the 48-year-old assembly worker from Detroit. “I get 85 percent of my pay, stay at home for two years, and then get full retirement.”

Ford is also offering packages to 10,000 white-collar workers, with further unspecified reductions in 2009. The company said the reductions will bring manufacturing capacity more in line with lower demand and allow the company to become more competitive.

The figures released Wednesday include approximately 30,000 employees who took buyouts during the open signup period that concluded late Monday, plus about 8,000 who took deals offered at limited plants earlier this year. Of the 38,000, about 6,000 are hourly employees at former Visteon Corp. plants that Ford took back from the auto parts supplier earlier this year. Joe Laymon, Ford group vice president for human resources and labor affairs, said the company’s new leadership understands winning concessions from unions isn’t enough. Ford will renegotiate contracts with the United Auto Workers next fall.

“We have to also pick up our game,” Laymon said in a conference call with reporters. “This is not just only a company-union deal here in terms of the UAW giving things to us to make sure we are a viable company.” He added that one of chief executive Alan Mulally’s priorities is to make sure that “we accelerate the development of what our customers want.”

The eight packages offered to hourly employees range from $35,000 to $140,000. Marty Mulloy, Ford’s vice president of labour affairs, said 53 percent of the workers selected nontraditional packages, with the majority taking either lump sum payments or one of two education plans. One four-year package offers up to $15,000 per year for college tuition, plus half of the worker’s salary and health benefits, while another offers to pay 70 percent of pay and tuition for two years.

Ford spokeswoman Marcey Evans said the company is offering three programs to salaried workers — two early retirement packages and a buyout program. If the salaried workers are offered one of the packages, they are not able to select another, although all of the programs at this point are voluntary, she said.

Offers for two of the programs already have been made, while a third will go out in mid-December, she said.

“We think that the majority of the people who take the voluntary separation packages will do so by the end of the first quarter,” Evans said.

Ford shares rose 2 cents to close at $8.17 on the New York Stock Exchange yesterday.