Ford announces massive job cuts in Europe as part of shift to electrification

Ford announced on Tuesday it was cutting 3,800 jobs, or the equivalent of one in nine jobs in Europe as part of the automaker’s efforts to cut costs amid their shift to electrification.

As many as 2,300 of those jobs will be at Ford’s Cologne and Aachen plants in Germany, or about 12% of Ford’s workforce in the country. The next largest chunk will come from the UK where approximately 1,300 will be lost, or about one in five jobs, with the remaining 200 coming from various countries in Europe. According to Ford they will seek to achieve these jobs reductions through voluntary programs.

The job cuts are the result of the automaker’s shift to electrification, a platform which requires less labour and high profit margins to be competitive, something which Ford does not currently have. Last month the company said they don’t expect their EV unit to become profitable until at least 2026.

“There is significantly less work to be done on drivetrains moving out of combustion engines. We are moving into a world with less global platforms where less engineering work is necessary. This is why we have to make the adjustments,” said European passenger EV chief Martin Sander. (via Reuters)

The announcement did not come without warning. During the company’s earnings call earlier this month CFO John Lawler said the expected $5 billion increase in costs this year as they ramp their EV production to around 600,000 units would lead them to be “very aggressive” in  reducing expenses elsewhere, particularly in manufacturing and supply chain.

While Ford is attempting to cut costs to remain competitive in the EV market, the company is also investing heavily in their EV future, announcing a partnership yesterday with China’s CATL to spend $3.5 billion on a LFP battery factory in Michigan.

Ford dumped 91 million Rivian (RIVN) shares in 2022

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