Salaried job cuts planned for Ford

Retirement offers available to some

DEARBORN, Mich. — Ford Motor Co. will offer retirement incentives with hopes of cutting its U.S. white-collar workforce by 1,400 more positions.

Kumar Galhotra, the company’s president of the Americas, told employees about the offers Wednesday morning. The company says they’re part of an $11 billion restructuring plan that started more than a year ago.

Most of the reductions would take place in the area of Dearborn, Mich., where Ford has its headquarters and large product development and engineering operations.

Shares of Ford rose 1.7% in Wednesday trading to $6.95.

A spokesman says Ford expects to meet its goals with the offers. If it doesn’t, then it may consider layoffs.

The offers will go to U.S. salaried workers who are eligible to retire as of Dec. 31. Those approved to retire would leave the company by the end of the year.

Eligible employees must apply and then be accepted. The window opens for those who qualify on Tuesday. Employees will receive more details from the company on that day.

“This is not an early retirement. This is an incentive for people today who are already retirement eligible,” said Ford spokesman Ian Thibodeau.

The offers won’t go out in every part of the business. For instance, information technology workers and those responsible for rolling out new vehicles will not be affected.

Ford has about 30,000 white-collar workers in the U.S.

Last year Ford said it would cut 12,000 jobs in Europe and 7,000 white-collar positions worldwide as it trimmed expenses to prepare for a world of autonomous and electric vehicles. The 7,000 salaried positions amounted to 10% of Ford’s total worldwide and included 2,300 in the U.S. The cuts were accomplished with buyouts and involuntary layoffs.

The carmaker said it expected the move will save $600 million a year. It had a worldwide workforce of 190,000 at the end of 2019.

The cuts were designed to reduce bureaucracy and allow the company to make faster decisions.

Like other automakers, Ford has been struggling this year as the coronavirus forced factory closures and chased customers away from showrooms. Factories have been reopened and demand is slowly returning.

From April through June, Ford’s posted better-than-expected results with a $1.12 billion net profit. It was pushed into the black by a $3.5 billion accounting gain on the value of its autonomous vehicle operation. Without that, it would have lost $1.9 billion.

Ford’s latest retrenchment comes as Jim Farley prepares to take over as chief executive officer on Oct. 1 from current CEO Jim Hackett. Farley has promised to “swing for the fences” to return Ford’s North American region to a 10% profit margin.