Ford to cut 4,000 jobs in Europe by 2027
US automaker Ford has announced plans to cut its workforce by 4,000 in Europe by the end of 2027. The decision comes amid economic challenges, increased competition, and disappointing sales of electric vehicles (EVs). Most of these job cuts will be implemented in Germany, with working hours also being reduced at Ford's factory in Cologne.
Job cuts represent 2.3% of Ford's global workforce
The proposed job cuts account for nearly 2.3% of Ford's global workforce, which currently comprises 174,000 employees. The company has said that the cuts will be made in consultation with employee representatives. The move will have a major impact on Germany, Europe's largest economy and top carmaker, where Volkswagen is also mulling factory closures and job cuts to improve competitiveness.
Response to industry disruption and European challenges
Dave Johnston, Ford's European VP for Transformation and Partnerships, stressed the need for decisive action to secure Ford's future competitiveness in Europe. The company noted that the global auto industry is undergoing a major disruption with the transition to electrified mobility. The transformation is particularly intense in Europe where automakers are grappling with competitive and economic challenges, and a mismatch between CO2 regulations and EV demand.
Sales decline and call for government support
Ford's sales in Europe have dropped by 17.9% through September this year, a number much higher than the industry-wide decline of 6.1%. The firm has called on the German government to offer more incentives and better charging infrastructure to ease consumer transition to EVs. The appeal comes after Berlin ended EV subsidies in December last year, resulting in a 28.6% drop in Germany's EV sales in the first nine months of this year.
Ford's restructuring and industry-wide cost-cutting measures
Ford is undergoing a major restructuring in Europe, having announced 3,800 job cuts in February 2023. The company also plans to shut its Saarlouis factory in Germany next year, leading to more job losses. Ford's move is similar to the cost-cutting measures taken by other automakers like Nissan, Stellantis, and GM as they face increased competition from Chinese rivals and the high costs of transitioning to EVs.
