Ford announces 7,000 job cuts as US car maker moves up a gear in restructuring plan
Ford is to cut around one-tenth of its global salaried workforce by the end of August as part of a major global restructuring plan.
Read more: Ford gears up to announce up to 550 white collar job losses in UK
The move to shed 7,000 workers this summer is expected to save the firm $600m a year, chief executive Jim Hackett said in a letter to employees today. The announcement follows on from similar news last week, when City PM revealed Ford was to cut around 550 white collar workers as part of the European wing of the turnaround plan.
Hackett said the firm will get rid of nearly 20 per cent of higher-level managers, in a bid to reduce bureaucracy and make decision making faster. Around 2,300 of the job losses are expected to come in the United States.
City PM understands the first 900 people will be let go this week.
A Ford spokesperson said the firm had completed the majority of a “redesign” of its North America business. “This work has resulted in some separations of salaried employees and the reassignment of others. By the end of the process in August, we expect to have eliminated about 7,000 salaried positions or about 10% of our global salaried workforce.”
They added: “We understand this is a challenging time for our team, but these steps are necessary to position Ford for success today and yet preparing to thrive in the future.”
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Meanwhile in Europe, they said: “Initiatives are expected to reduce in excess of 5,000 jobs in Germany, including hourly, salaried and temporary staff. The total number of salaried positions impacted in the UK is still to be determined.”
As well as the global job cuts, chief executive Jim Hackett’s plan to turn the automotive giant around has included investing $500m in US electric truck company Rivian, forming an alliance with Europe’s biggest car maker Volkswagen and withdrawing from the Russian market.