Ford to cut 3,000 jobs in pivot to electric cars

Iconic American automaker Ford has said it will cut a total of 3,000 jobs in the United States, Canada, and India, as it seeks to restructure and pivot towards developing software-driven electric vehicles.

In a letter sent to employees seen by Reuters and Automotive News, and confirmed as authentic by a Ford spokesperson, company CEO Jim Farley and executive chair Bill Ford explained that the company would cut 2,000 salaried positions and 1,000 agency jobs.

“Building this future requires changing and reshaping virtually all aspects of the way we have operated for more than a century,” Farley and Ford wrote to employees.

“It requires focus, clarity and speed. And, as we have discussed in recent months, it means redeploying resources and addressing our cost structure, which is uncompetitive versus traditional and new competitors.”

“We are eliminating work, as well as reorganizing and simplifying functions throughout the business. You will hear more specifics from the leaders of your area of the business later this week.”

It is expected the cuts will be made across a variety of roles and are expected to affect employees in both its Ford Blue and Model e divisions, as well as at Ford Credit and in its purchasing division.

“None of this changes the fact that this is a difficult and emotional time,” Farley and Ford continued.

“The people leaving the company this week are friends and coworkers and we want to thank them for all they have contributed to Ford. We have a duty to care for and support those affected – and we will live up to this duty — providing not only benefits but significant help to find new career opportunities.”

The news comes with little surprise following numerous comments made by Ford executives in recent months that have all but promised significant layoffs.

During the company’s second-quarter earnings call in July, Farley foreshadowed the need to cull jobs within its workforce to better refocus on a shift towards manufacturing electric vehicles.

“We absolutely have too many people in certain places,” said Farley. “No doubt about it. And we have skills that don’t work anymore, and we have jobs that need to change.

“We have lots of new work statements that we’ve never had before. We are literally virtually reshaping our company, like every part of our company.

“And you know the ICE business, we want to simplify it, we want to make sure the skills we have and the works statements we have are as lean as possible. We know our costs are not competitive at Ford. That’s what I mean by we are not satisfied.”

The layoffs come amidst a larger company-wide restructuring and cost-cutting effort that Ford initiated earlier this year. In March, Ford announced that it would split its EV and internal combustion engine (ICE) vehicles into two units, with Ford Model e dedicated to EVs, software, and connected vehicle technology. Ford Blue would continue to build out ICE vehicles.

Ford also created a third unit, Ford Pro, that would handle commercial and government customers with work-ready ICE models and electric products and services to manage fleets.

In its second-quarter earnings, Ford said that this restructuring had already allowed the automaker to trim $US3 billion in annual costs from its ICE development efforts.