Ford Motor Company says it will reduce its workforce by 4000 in Europe and the UK by the end of 2027, citing headwinds from the economy and pressure from increased competition and weaker than expected sales of electric cars.
US-based Ford said on Wednesday (Thursday AEDT) most of the job cuts would come in Germany and would be carried out in consultation with employee representatives.
Of the total, 2900 jobs would be lost in Germany, 800 in Britain and 300 in other European Union countries. Ford has 28,000 employees in Europe, and 174,000 worldwide.
“The global auto industry continues to be in a period of significant disruption as it shifts to electrified mobility,” the company said in a statement.
“The transformation is particularly intense in Europe where automakers face significant competitive and economic headwinds while also tackling a misalignment between CO2 regulations and consumer demand for electrified vehicles,” the statement said.
In Europe, vehicle makers must sell enough electric vehicles (EVs) to meet new, lower limits for fleet average carbon dioxide emissions from next year, and face a longer term 2035 EU goal of reducing emissions to zero, which would mean the elimination of most vehicles with internal combustion engines.
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EV sales however have lagged as consumers weary of inflation have held back on spending and after major car market Germany dropped government purchase incentives for EVs.
Sales of EVs fell by 5.8 per cent in the first nine months of the year in an overall shrinking market for cars. Carmakers are also facing increasing competition from Chinese-made electric vehicles.
The company said that it would also reduce working time for workers at its Cologne, Germany plant where it makes the Capri and Explorer electric vehicles.
Ford sales fell 15.3 per cent in the first nine months of the year compared with the same period last year, according to the European Automobile Manufacturers’ Association.
The company’s market share shrank to 3 per cent from 3.5 per cent.
The Michigan-headquartered carmaker recorded a fall in company-wide net profit by 26 per cent to $US892 million ($1.3 billion) in the third quarter as it took $US1 billion ($1.5 billion) in accounting charges to write down assets for a cancelled electric SUV. The company cited higher warranty and other costs.
