Ford is cutting 7,000 white-collar jobs

Andrew Cummings
May 20, 2019

Ford Motor Company announced it will be eliminating 7,000 salaried workers by August, as part of a "smart redesign", with the North American job cuts coming in the next few days.

It says the company's management team is shrinking by close to 20% as part of the restructuring, which will save Ford about $600 million a year.

The cuts amount to 10 per cent of Ford's global salaried workforce.

In the USA about 2,300 jobs will be cut through buyouts and layoffs, about 1,500 of which have already happened. About 1,500 have left voluntarily or with buyouts, while another 300 have already been laid off.

Restructuring work continues in Europe, China, South America and the International Markets Group and the Dearborn, Michigan-based company expects to complete the process in those markets by the end of August, Hackett said.

A spokesperson tells 7 Action News that about 1,500 people took buyouts a year ago, which will bring the total eliminations in the United States to around 2,300.

It is the second major U.S. carmaker to announce redundancies, following GM which is shedding 14,000 posts. The layoffs included closure of five factories in the USA and Canada and cuts of another 8,000 white-collar workers worldwide.

"Ford is squeezing every cent they can out of the current business by cutting employees, cutting products and getting out of unprofitable businesses so they can put more money into future technology like electric vehicles, autonomous vehicles and mobility services", said Michelle Krebs, an analyst with car-shopping researcher Autotrader.

Trump has harshly criticised automakers, especially General Motors, for cutting jobs, but has focused primarily on blue-collar cuts at factories rather than white-collar reductions. Many have been upset that it took so long for the company to make decisions.

The layoffs, while large, weren't as bad as many had expected. That stood in contrast to how GM handled layoffs earlier this year where employees were asked to leave immediately.

"Ford is a family company and saying goodbye to colleagues is hard and emotional". Hackett told employees that managers would have more direct reports to cut down bureaucracy.

Within the cuts, Hackett said it will eliminate close to 20% of upper-level managers, a move meant to reduce bureaucracy and speed up decision making.

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