Ford to cut 10 percent of global workforce
- Author: Zachary Reyes May 25, 2017,
May 25, 2017, 7:51
Ford says the positions to be cut include those in human resources and marketing, but exclude other types of skills such as product development, information technology and plant manufacturing.
But investors are clearly anxious that sales in the U.S., Ford's biggest market, are peaking.
Reducing costs and becoming "as lean and efficient as possible" is a priority, Ford said in an emailed statement.
President Trump on the campaign trail routinely criticized the auto industry for building plants in Mexico and making cars and vehicle parts there instead of the U.S.
The No. 2 USA automaker said it must focus on "becoming as lean and efficient as possible" as it announced job cuts that will affect 1,400 of about 15,000 salaried workers in its North America and Asia divisions and will be completed by October.
The carmaker now hires approximately 30,000 staff in the USA, an estimated 3,000 of whom will face being cut in order to "drive profitable growth".
The Dearborn automaker has been under pressure both from its board of directors and from shareholders in recent days to show that its strategic plan is working as USA industry sales begin to decline for the first time in seven years.
About half of Ford's employees are in North America.
Michelle Krebs, an analyst with AutoTrader, said Ford may be taking a prudent action to prepare for declining USA industry sales.
Today, Ford said it remains focused on its strategic plan to transforming traditionally underperforming areas of its core business and to investing in emerging opportunities, such as mobility and autonomous vehicles. Ford said April 27 when it reported first-quarter earnings that it planned to cut $3 billion in costs.
Post the criticism, Ford had made a decision to create about 700 jobs in MI, instead of building a $1.6 billion auto factory in Mexico. Electric auto maker Tesla Inc. recently surpassed Ford in market value even though it sells far fewer vehicles.