Dearborn, United States of America (USA)- According to Ford’s Chief Executive, Jim Farley and Executive Chair, Bill Ford, the automobile multinational company is planning on cutting 2 000 salaried employees and terminating another 1 000 contract workers mostly in the United States (US) and Canada.
The move had been expected for some time as Ford aims to generate half of its global sales from fully Electric Vehicles (EVs) by 2030.
“Building this future requires changing and reshaping virtually all aspects of the way we have operated for more than a century. It requires focus, clarity and speed, and, as we have discussed in recent months, it means redeploying resources and addressing our cost structure, which is uncompetitive versus traditional and new competitors.
None of this changes the fact that this is a difficult and emotional time. The people leaving the company this week are friends and coworkers and we want to thank them for all they have contributed to Ford. We have a duty to care for and support those affected and we will live up to this duty providing not only benefits but significant help to find new career opportunities,” said Farley and Ford in a memo.
Ford in March split operations into separate businesses, with one focusing on internal combustion engines and another on EVs. The company had 183 000 employees at the end of 2021, down from 186 000 at the end of 2020.
However, Ford assembly lines will not be closed as part of the shift to EVs. In fact, Ford is building new EV and battery plants.
Ford’s US group plans to derive one-third of overall sales from EVs by 2026, rising to half by the end of the decade. In Europe, where there were extensive cuts under the previous Chief Executive, the company has committed to making all passenger cars electric by 2030.
The carmaker also committed in March to spending US$50 billion by 2026 as it boosts its EV business, building factories and hiring more software and electrical engineers. It is an increase from the original US$30 billion it pledged.
In June, Ford reported a profit of US$667 million for the second quarter. While that was about 20 percent more than a year ago, it was held down by increased costs and was relatively small compared to its 50 percent jump in revenue from a substantial rise in vehicle sales and higher prices.
