Ford Motor Company said it would start staff layoffs this week, mainly affecting engineering jobs in the US and Canada, as part of cost-cutting measures to boost growth and increase profit.
The job cuts are likely to affect the Michigan-headquartered car manufacturer’s three business units – Ford Blue, the traditional combustion engine operations; Model e, the electric vehicle unit; and Ford Pro, the fleet service business.
However, the company did not disclose the exact number of job cuts.
“People affected by the changes will be offered severance pay, benefits … this is related to the Ford+ growth plan we introduced in 2021,” Reuters quoted Ford as saying.
“Delivering on the plan includes adjusting staffing to match focused priorities and ambitions while raising quality and lowering costs.”
Ford did not reply immediately to The National’s request for comment.
The company’s stock was up 1.42 per cent at $14.21 a share at 6.55pm UAE time on Tuesday.
Ford reported a 20 per cent annual surge in first-quarter revenue to $41.5 billion. Its net income rose to $1.8 billion compared with a net loss of $3.1 billion in the same period last year.
Last month, Ford said it was expecting to take up restructuring charges between $1.5 billion and $2 billion this year as part of its strategy to move from unprofitable locations and cut headcount.
The charges will be “primarily attributable to employee separations and supplier settlements”, the company said in a regulatory filing.
“We continue to review our global businesses and may take additional restructuring actions where a path to sustained profitability is not feasible when considering the capital allocation required for those businesses,” it added.
In February, Ford announced plans to slash 3,800 jobs in Europe over the next three years as it shifted its focus to EVs.
The company said it intended to cut 2,300 jobs in production development and administration in Germany, 1,300 in the UK and 200 in other parts of Europe, where it employed nearly 34,000 people.
In July last year, the company reportedly said it would cut 8,000 jobs in its Ford Blue business arm. It also revealed plans to slash 3,000 employees and contract workers across various departments in the US, Canada and India in August.
US-based employers announced 80,089 cuts in May, marking a 287 per cent annual increase and a 20 per cent increase from the 66,995 cuts announced in April, according to a report by research company Challenger, Gray & Christmas.
In the first five months of this year, US companies have announced plans to cut 417,500 jobs, a 315 per cent annual increase, the report, released earlier this month, found.
It is the highest January-May total since 2020, when 1,414,828 cuts were recorded during the Covid-19 pandemic.
With the exception of 2020, it is the highest total in the first five months of the year since 2009, when 822,282 cuts were tracked.