Reportedly, Ford Motor Co. plans to put off at least 1,000 hired and contract workers because the auto giant looks to offset investment costs in the electrical vehicle market.
During internal meetings on Monday, North American salaried workers were briefed on upcoming job cuts expected to significantly impact engineers, said people acquainted with the matter. Wall Street Journal.
A spokesman for the Detroit automaker confirmed the news on Tuesday, adding that layoffs will be concentrated in its engineering, gas engine and business vehicle divisions.
Managers have told employees on the affected teams that they need to do business from home for the remainder of the week, The Journal reports.
“We didn’t provide The Journal’s number or confirm its speculation,” a Ford spokesman told The Post.
“These actions are related to the Ford+ development plan that we introduced in 2021 and have been implementing an increasing number of over the past yr,” he added.
The Ombudsman continued: “The implementation of the plan involves aligning staff with defined priorities and ambitions, while improving quality and reducing costs. What we’re doing this week within the US and Canada is usually, but not limited to, engineering roles. Those affected by the changes will be offered severance pay, advantages and significant assistance find recent profession opportunities.
The move got here after Ford touted its “ambitious, comprehensive plan to transition to an electrical lifestyle.” websitenoting that it plans to take a position “over $50 billion in electric vehicles worldwide by 2026.”
The automaker has already launched an electrical truck, dubbed the F-150 Lightning, with 4 models priced between $59,974 and $98,074.
Although Ford’s revenue grew 20% year-on-year in the primary quarter of 2023, sales of the F-150 Lightning were underperforming.
About 4,300 units of the electrical truck were sold in the primary quarter of this yr – about 2,000 lower than expected – as Ford’s hottest gas-powered F-150 line sold greater than 170,000 units in the identical period.
Nonetheless, the dearth of revenue from electric vehicles has not stopped Ford from persevering available in the market.
Ford in April announced a $1.3 billion enterprise to convert the Oakville Assembly Plant in Ontario, Canada into the Oakville Electric Vehicle Complex.
Six-month trading will start within the second quarter of 2024.
Upon completion, the ability will produce next-generation electric vehicles that will hit the market in 2025.
Recently, Ford announced that it had reached an agreement with its EV rival, Tesla, under which Ford EV drivers will have access to greater than 12,000 Tesla top-ups across the US and Canada starting in 2024.
With quite a few costly electric vehicle operations underway, Ford has made several rounds of worldwide redundancies to cover the massive costs of switching from internal combustion vehicles to electric vehicles.
Last August, the US automaker laid off 3,000 white-collar workers.
On the time, executive chairman Bill Ford and CEO Jim Farley said in an email that Ford would supply employees with advantages and significant assistance find recent jobs.
Then in February, the Michigan-based automaker announced it could hire 3,800 workers in Europe over the subsequent three years.
In 2022, Ford employed a complete of roughly 173,000 people – 5.46% lower than 183,000 employees in 2021.
This number in 2021 was 1.61% lower than the variety of Ford employees in 2020.
While Ford’s profits have been healthy, it’s unclear whether this may be attributed to the layoffs.
Based on the Q1 2023 earnings report, Ford’s revenue was $41.5 billion, up 20% from the identical period in 2022, when profits were $34.5 billion.
Despite news of recent layoffs, Ford’s share price rose nearly 1% late Tuesday morning. For the reason that starting of the yr, shares have increased by 21.92%.