Ford likely to cut workforce to reduce costs
- Author: Zachary Reyes May 18, 2017,
May 18, 2017, 21:12
Ford Motor Co. plans to cut 10 percent of its salaried jobs in North America and Asia Pacific this year in an effort to boost profits.
WSJ's report claims that a majority of these cuts will be aimed at salaried employees, and Reuters alleges that some workers will be offered "generous" early retirement packages in order to reduce future overhead.
But the company is still moving ahead with plans announced a year ago to shift all small vehicle production to Mexico.
There was no immediate comment from President Donald Trump, who has needled Ford about taking jobs to Mexico but celebrated the company's US investments.
- Ford has around 30,000 salaried workers in the United States.
Ford spokesman Mike Moran refused to comment directly on the reported job losses but said in a statement that the company was focused on driving "profitable growth".
What's more, the USA auto market, where Ford makes the bulk of its profit, appears to have peaked in 2016, meaning Ford must find other areas to bolster the bottom line.
A Ford spokesperson said in an email the company "has not announced any new people efficiency actions, nor do we comment on speculation".
Ford said last month it plans to cut costs by $3 billion in 2017, despite commodity prices rising by $1 billion.
The Ford Motor Co. logo is seen on the front of a new 2012 Ford Focus. The cuts will not apply to Ford's Europe or South America units.
The Dearborn, Mich., auto maker has booked substantial profits in recent years, including two consecutive years of record earnings, but Ford's market capitalization earlier this year sunk below that of electric-car startup Tesla Inc. Ford has almost 30,000 salaried employees in the USA and over 200,000 worldwide.
The reductions will mostly be in North America and the Asia Pacific region. "Car companies coming back to U.S. JOBS!"
After seemingly appeasing US president Donald Trump past year with the cancellation of a proposed $1.7 billion (Rs 10,738 crore) Mexico-based factory and the announcement of a $700 million (Rs 4,421 crore) investment into a plant in Michigan, US, the move could anger the famously nationalistic Republican president.
The company's share price has fallen by almost 40% since Mr Fields took up his role in the middle of 2014.