Ford is planning a major round of layoffs that will cut up to 20,000 jobs around the world, according to reports published Monday.
Ford will cut about 10% of its global workforce of 200,000, and could announce the plan this week, Wall Street Journal reported, citing people briefed on the plans. Reuters reported the cuts would eliminate 10% of Ford’s salaried staff in North America and Asia. Both reports said the layoffs would target salaried staff, not the hourly employees working on factory floors.
A spokesperson for the United Auto Workers union, which represents Ford factory workers, told BuzzFeed News that its members would not be affected by the cuts.
A Ford spokesperson said in an email the company “has not announced any new people efficiency actions, nor do we comment on speculation.”
Ford has roughly 30,000 salaried workers in the US and 200,000 salaried employees worldwide.
Profits for the Detroit-based automaker fell 35% during the first quarter to $1.6 billion, the first such decline in seven years. The company is working to cut $3 billion in costs, its CEO Mark Fields said in a recent earnings call, as part of an “intense focus on costs” in preparation “for a downturn scenario.”
Since taking the top job at the car marker in 2014, Fields has delivered consistent profits, but the company’s stock price has fallen by more than a third. At the beginning of April, Tesla overtook Ford to become America’s second most valuable car company; the stock prices of the two car makers has continued to diverge since then.
Large-scale layoffs at an icon of American manufacturing could come with a degree of political risk for Ford, which recently earned praise from President Trump for its plants to expand its factories in Michigan. In March, he tweeted in celebration of Ford’s plans to invest $1.2 billion and create 130 jobs in the expansion, much of which had been previously planned and announced.
“Major investment to be made in three Michigan plants,” he tweeted. “Car companies coming back to U.S. JOBS! JOBS! JOBS!”
In January, Ford also added 700 Michigan jobs, following criticism from Trump over plans to increase production in Mexico.
In an email to BuzzFeed News, Democratic Congressman Brendan Boyle of Pennsylvania said job cuts will not make US businesses competitive, and that “we must instead invest in quality, full-time, salaried workers if our nation is to keep manufacturing the best products in the world.”
Boyle is co-chair of the Blue Collar Caucus, group of Democrats in Congress who came together following Trump’s election to “reassert Democrats’ historic role as the true champions of working people.”
A White House spokesperson did not respond to a request for comment on the reported layoffs.
A Ford spokesperson, who declined to comment on the reported layoffs, said in a statement that the company is focused on “strategic priorities that will create value and drive profitable growth,” including investing “aggressively, but prudently” in new opportunities.
“The bottom line is the biggest strategic shift in the history of our company is well under way and gaining momentum,” CEO Mark Fields said in a May 11 call with shareholders, referring to the rise of electric and self-driving cars. Fields predicted one out of every five cars sold by 2030 could be an autonomous vehicle and called the shift a “big business opportunity.”
“Reducing costs and becoming as lean and efficient as possible also remain part of that work,” the spokesperson said on Tuesday.
Ford Will Lay Off Thousands Of Staff, Reports Say – BuzzFeed News