Ford Motor Co announced its decision to cut jobs in the United States and Canada as part of its strategy to reduce costs and exit unprofitable locations. The company will primarily target engineering positions in this round of layoffs, which is expected to commence this week. Ford anticipates restructuring charges between $1.5 billion and $2 billion in 2023.
Although the Wall Street Journal reported that at least 1,000 salaried employees and contract workers in North America will be affected, Ford has not disclosed the exact number of positions to be eliminated. The company assured that affected individuals would receive severance pay and benefits. The job cuts are not limited to engineering roles, as stated by Ford in an email statement. This move aligns with the Ford+ growth plan introduced in 2021, which aims to adjust staffing levels, enhance quality, and reduce costs to meet the company’s priorities and ambitions.
Ford’s decision to streamline operations follows similar actions taken by its peers in the industry. Stellantis NV and General Motors recently offered employee buyouts, signaling a broader trend within the automotive sector. CNBC reported that the job cuts at Ford are expected to impact all three of its business units: Ford Blue, Model e, and Ford Pro.
Ford’s CEO, Jim Farley, has emphasized the need to align the workforce with the evolving demands of the auto industry. With the industry’s transition towards electric vehicles and digital services, Farley has expressed that the company currently employs an excess number of individuals who may lack the necessary skills. Ford’s streamlining efforts also extend beyond North America, as the company previously outlined plans to eliminate 3,800 product development and administration jobs in Europe over the next three years.
In summary, Ford Motor Co’s decision to cut jobs in the United States and Canada is part of its larger strategy to improve profitability and adapt to the changing landscape of the automotive industry. The company aims to reduce costs, exit unprofitable locations, and realign its workforce to meet the demands of electric vehicles and digital services.
Source: Reuters
