Ford set to lay off thousands of workers
Bid to return business to profitability in a restructuring that doesn’t rule out shutting down production plants
FORD MOTOR Co will shed thousands of jobs at its European operations in a bid to return the business to profitability in a broad restructuring that doesn’t rule out shutting down production plants.
The carmaker has struggled with an ageing model line-up and a contracting market in the UK, Ford’s biggest in Europe, which is in store for further disruption from Brexit. The manufacturer employing some 54 000 workers across the region – mainly in Germany, the UK and Spain – plans to cull less profitable models from its line-up and review its joint venture in Russia. In the US, the company is already dropping several sedans.
“We are looking to make a stepchange in the performance of the business,” Steven Armstrong, Ford’s head of Europe, said yesterday in an interview. “There’ll be significant impact across the region. We will be looking at all options,” which could include plant closures.
The overhaul marks another sign of pressure on traditional carmakers as they grapple with fundamental technology changes, stiffening environmental regulations and trade tensions. Brexit represents a particular challenge for European carmakers, because of the close ties between the UK and the continent. Tata Motors’ Jaguar Land Rover, formerly part of Ford, plans to cut as many as 5 000 jobs in the UK, BBC reported.
Ford last year kicked off a company-wide $11 billion (R152.96bn) restructuring after both Europe and Asia swung to losses and costs to invest in electric and self-driving vehicles mount. Like many other carmakers, Ford has warned it won’t meet its forecasts for 2018, and chief executive Jim Hackett jettisoned a goal to reach an 8 percent profit margin by 2020.
The company, which didn’t specify the number of jobs it plans to cut, will seek to reduce European staff through voluntary measures as far as possible, the Dearborn, Michigan-based manufacturer said. The review also includes “rescaling the footprint of the business” with Ford reviewing the efficiency of its plants, Armstrong said.
Ford has already said it will cease production at a plant in Bordeaux, France, and has started labour talks at the Saarlouis factory in Germany after a decision to end production of the C-MAX compact van.
A review of the Ford Sollers joint venture in Russia is expected to conclude in the second quarter, it said.