American automobile manufacturer Ford announced Tuesday that it will cut 3,800 jobs over the next three years in Europeciting the need to increase competitiveness and focus on its future electric models.
The company said 1,700 product development positions and 600 administrative functions will be cut in Germany. In the UK, 1,000 development division jobs and 300 administration jobs will be axed.
The manufacturer did not specify which other countries will be affected by the other 200 layoffs.
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“These are difficult decisions, which are not taken lightly”said Martin Sanders, general manager of Ford Model for Europe.
“We recognize the uncertainty it creates for our teams and I assure you that we will offer our full support in the coming months.” added the manager.
The company stated that the decision is aimed at revitalizing its business in Europe and competing with greater profitability.
These layoffs will take place over three years and will begin on a voluntary basis.
In parallel, Ford will reduce the number of models designed for Europe, concentrating in the future on its electric models and its highly profitable sales of vans.
As a consequence, vehicle design teams will be cut in half.
These cuts had been announced at the end of January by the German union IG Metall.
“The company wants to carry out the main development tasks in North America”, in relation to “the transition from heat engines to electric motors”, the union had then explained.
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The brand has just broken even financially in the European market in 2022, with 516,614 new vehicles sold and a market share of 4.6%.
“Necessary changes”
The group’s financial director, John Lawler, had indicated in early February that Ford would have to make “necessary changes” to make profitable its sales in Europe, in a context of economic instability and demand.
Ford is in the throes of electric vehicles, a technology that requires a complete modernization of existing factories and in which it intends to invest $50 billion by 2026.
The manufacturer already announced in the summer of 2022 that it would cut several thousand jobs in the United States and India by converting its factories to electric power.
Ford is going to launch in the coming weeks the manufacture of its first European electric vehicle in Cologne (Germany).
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Its plant in Turkey has also started manufacturing electric vans.
The European bloc will ban the sale of new gasoline and diesel cars by 2035.
Ford’s European plants currently employ 34,000 people from the UK to Turkey.
These cuts coincide with a time of fear that there will be a relocation of the automotive industry in Europe, since the United States introduced significant subsidies for electric vehicles manufactured in its territory, as part of the economic plan provided for by the Inflation Reduction Act. (IRA in English).
Source: AFP
Source: Gestion
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