London
CNN
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Ford plans to cut almost 4,000 jobs in Europe over the next three years, about 14% of its workforce in the region, as the carmaker faces slowing demand for electric vehicles and rising competition from China.
The US company said Wednesday that the cuts would be completed by the end of 2027, pending consultations with labor unions, and would be concentrated in Germany and the United Kingdom.
“The global auto industry continues to be in a period of disruption, especially in Europe, where the industry faces unprecedented competitive, regulatory and economic headwinds,” Ford said in a statement.
Dave Johnston, Ford’s European vice-president for transformation and partnerships, added: “It is critical to take difficult but decisive action to ensure Ford’s future competitiveness in Europe.”
Global automakers are under pressure from lackluster sales and intense competition from China, where EV makers are stealing market share from Western rivals, which have traditionally dominated the world’s largest passenger car market.
Ford’s passenger vehicle business has incurred significant losses in Europe in recent years. Like other carmakers, it has had to cut prices for its EVs, which have been badly loss-making, and it has scaled back EV production targets.
Last year, the company said it would axe around 4,900 jobs across Europe.
On Wednesday, Ford said it would further adjust production of its new Explorer and Capri models in Europe, resulting in shorter working days for staff, “due to the weak economic situation and lower-than-expected demand for electric cars.”
Ford’s chief financial officer John Lawler recently wrote a letter to the German government calling for steps to improve market conditions for automakers.
“What we lack in Europe and Germany is an unmistakable, clear policy agenda to advance e-mobility, such as public investments in charging infrastructure, meaningful incentives to help consumers make the shift to electrified vehicles, improving cost competitiveness for manufacturers and greater flexibility in meeting CO2 compliance targets,” Lawler said.
The news of the Ford cuts comes just weeks after Volkswagen said it would trim employee pay by 10% to protect jobs and safeguard the company’s future. The German automaker plans to close at least three factories in its home country and lay off tens of thousands of staff as it grapples with a weak car market in Europe and a steep loss of market share in China.
Earlier Wednesday, Volkswagen workers said they would be prepared to forfeit pay increases totaling €1.5 billion ($1.6 billion) if executives at the company pledge not to close any factories and agree to sacrifice a portion of their bonuses.