Global moves at Ford, Jaguar Land Rover

South Florida Sun-Sentinel (Sunday) - - People On The Move - By David McHugh and Dan­ica Kirka

FRANK­FURT, Ger­many — The head­winds buf­fet­ing the global auto in­dus­try made them­selves felt in Europe on Thurs­day as mass-mar­ket car­maker Ford and lux­ury-fo­cused Jaguar Land Rover an­nounced sweep­ing re­struc­tur­ings that will cost thou­sands of jobs.

Ford Mo­tor Co. said it will drop an un­spec­i­fied num­ber of jobs in Europe as it seeks to make its busi­ness there more con­sis­tently prof­itable. Ford is re­fo­cus­ing on com­mer­cial trucks and SUVs and dump­ing less lu­cra­tive models while shift­ing pro­duc­tion to elec­tric cars over the longer term.

The Dear­born, Mich.based com­pany said re­duc­tions would be achieved as far as pos­si­ble through vol­un­tary de­par­tures ne­go­ti­ated with unions and em­ployee rep­re­sen­ta­tives. Ford of Europe, based in Cologne, Ger­many, has 53,000 peo­ple work­ing for it di­rectly and 68,000 when joint ven­tures such as those in Rus­sia and Tur­key are in­cluded.

The com­pany’s new plans fol­low moves to close an au­to­matic trans­mis­sion plant in Bordeaux, com­bine ad­min­is­tra­tive head­quar­ters in Bri­tain and end pro­duc­tion of its C-Max models in Saar­louis, Ger­many.

“In the last cou­ple of decades, Ford of Europe has never re­ally been sus­tain­ably prof­itable,” Steven Arm­strong, com­pany vice pres­i­dent and head of its op­er­a­tions in Europe, Mid­dle East and Africa, said in a con­fer­ence call with re­porters. “We can only al­lo­cate cap­i­tal to ar­eas where we can get a re­turn on that cap­i­tal.”

Global au­tomak­ers face mul­ti­ple chal­lenges.

They must ad­just to sweep­ing change ex­pected

from a move to­ward bat­tery-pow­ered and au­tonomous ve­hi­cles, and to­ward pro­vid­ing trans­porta­tion as a ser­vice through ride-hail­ing and car-shar­ing smart­phone apps.

Car­mak­ers are also fac­ing a shift in con­sumer pref­er­ence away from sedans and hatch­backs to SUVs.

Mean­while, gov­ern­ment reg­u­la­tion in the Euro­pean Union and China are push­ing them to de­velop more elec­tric cars.

On top of that, con­sumer and busi­ness con­fi­dence have been hit by wor­ries about Bri­tain’s pos­si­ble de­par­ture from the Euro­pean Union with­out a ne­go­ti­ated trade deal, and by the U.S.China trade dis­putes.

One key head­wind — slow­ing auto sales in China — was the big is­sue for Jaguar Land Rover. The com­pany says it will cut

4,500 jobs as it deals with the China down­turn and grow­ing uncer­tainty about the terms of Brexit. The lux­ury car­maker, owned by In­dia’s Tata, says the cuts will be in ad­di­tion to the

1,500 peo­ple who left the busi­ness in 2018. The com­pany em­ploys about 44,000 peo­ple in the U.K.

Chris­tian Stadler, pro­fes­sor of strate­gic man­age­ment at War­wick Busi­ness School, said Jaguar was

fac­ing a “per­fect storm of chal­lenges,” with the drop in Chi­nese sales be­ing the most im­me­di­ate prob­lem.

“That is JLR’s big­gest mar­ket,” Stadler said.

The cuts will not just be bad news for the Jaguar staff, Stadler said.

Thou­sands more work­ers in the U.K. are part of Jaguar sup­ply chain — jobs that will now also be at risk.

“Brexit is an­other fac­tor, with busi­nesses in­creas­ingly con­cerned about the prospect of a ‘no deal’ Brexit, which would mean tighter bor­der con­trols,” he said. “That would cause mas­sive dis­rup­tion as the U.K. car man­u­fac­tur­ing in­dus­try is so closely in­te­grated with Europe.”

The Europe an­nounce­ments fol­low Gen­eral Mo­tors’ dis­clo­sure in Novem­ber that it would lay off

14,000 fac­tory and whitecol­lar work­ers in North Amer­ica and put five plants up for pos­si­ble clo­sure as it re­struc­tures to cut costs and fo­cus more on au­tonomous and elec­tric tech­nol­ogy.

Volk­swa­gen has said it will see an un­spec­i­fied num­ber of job re­duc­tions as it changes three plants in Ger­many to pro­duc­tion of elec­tric ve­hi­cles, but as­sures there will be no in­vol­un­tary de­par­tures be­fore



Car­mak­ers are fac­ing a shift in con­sumer pref­er­ence away from sedans to SUVs. Above, the 2020 Ford Ex­plore.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.