Ford (F.US) to Cut About 14% of European Workforce as EV Transition Proves Difficult, Competition Intensifies
1min read Ford (F.US) said on Wednesday it would cut about 14% of its workforce in Europe, as losses mounted due to weak demand for electric vehicles in recent years, lack of government support for the shift to electric vehicles and increased competition.
The US carmaker is the latest to slash costs, following Nissan (NSANY.US), Stellantis (STLA.US) and General Motors (GM.US), as the auto industry faces intensifying competition from Chinese rivals in Europe and the challenge of transitioning to electric vehicles, as the price of EVs remains too expensive for most consumers.
Ford said the 4,000 job cuts would be mainly in Germany and the UK, representing 2.3% of its total workforce of 174,000 globally.
The measures will hit Germany hard, the largest economy and biggest car producer in Europe, where Volkswagen has threatened to close factories, cut pay and slash thousands of jobs to improve competitiveness.
The country's deepening political crisis has also added uncertainty for companies trying to cope with trade tensions and the Trump victory in the US election.
Ford said the European job cuts would be completed by 2027.
The company said in a statement that European carmakers were "facing significant competition and economic headwinds, while trying to reconcile the mismatch between CO2 emissions regulations and consumer demand for electric vehicles."
Ford's European sales fell 17.9% in September, far more than the 6.1% industry-wide decline.
Ford also specifically called on the German government to provide more incentives and better charging infrastructure to help consumers make the switch to electric vehicles.
Germany ended subsidies for electric vehicles in December last year. Sales of EVs in Germany fell 28.6% in the first nine months of this year.
John Lawler, Ford's chief financial officer, wrote in a letter to the German government: "What we lack in Europe and Germany is a clear, unambiguous policy agenda to advance EVs, such as public investment in charging infrastructure, meaningful incentives ... and greater flexibility in meeting CO2 reduction targets."
Ford has been through painful restructuring in Europe and announced 3,800 job cuts in February 2023. It will also close its plant in Saarlouis, Germany, next year and further cut jobs.