UK (Commonwealth): Ford has disclosed it will lay off around 14% of its employees in Europe, citing losses in recent years due to a lackluster market for electric vehicles (EVs), a mediocre government reaction to the transition to EVs, and rivalry from Chinese competitors who receive subsidies.
The US manufacturer is the latest to cut costs, following Nissan, Stellantis, and GM, as the industry grapples with issues such as EVs that are too expensive for consumers to afford. Ford indicated that Britain and Germany would account for the majority of the 4,000 job losses. Ford is laying off roughly 2.3% of its 174,000 workers worldwide.
The sanctions will have a particularly negative impact on Germany, the largest economy in Europe. To increase its competitiveness, Volkswagen, the biggest carmaker in the area, is preparing to close plants, reduce wages, and destroy thousands of jobs.
Ford expects the European layoffs to occur by the last quarter of 2027, subject to discussions with unions. Ford predicted the loss of 2,900 jobs in Germany and 800 positions in Britain.
The company announced a reduction in the production of Explorer and Capri EV cars at its Cologne, Germany, facilities. The sanctions will have a particularly negative impact on Germany, the biggest economy in Europe. Volkswagen, the region’s largest automaker, has threatened to close facilities, cut salaries, and eliminate thousands of jobs in order to improve its competitiveness.
Peter Godsell, vice president of Ford Europe, told reporters that the company is facing lower demand for electric cars than anticipated and that it is still facing difficulties with running expenses. Therefore, we must act swiftly to reorganize our company.
He said, “We certainly can’t rule out” taking more action if market conditions worsen, adding that Ford hoped the job cuts would solve the company’s issues.
Ford’s European sales dropped 17.9% through September of this year, significantly more than the 6.1% loss in the industry as a whole. Additionally, Ford urged the German government to help people switch to electric vehicles by offering more incentives and improved infrastructure for charging EVs.
Berlin ceased subsidizing EVs in December of the previous year. The first 9 months of this year saw a 28.6% decline in EV sales in Germany.
Ford’s chief financial officer, John Lawler, wrote to the German government, “What is lacking in Europe and Germany is a clear and unambiguous policy agenda to promote e-mobility, such as meaningful incentives, public investments in charging infrastructure, and more flexibility in meeting CO2 compliance targets.”
In February 2023, Ford announced 3,800 layoffs as part of a grueling restructuring in Europe. Next year, it plans to close its Saarlouis facility in Germany and lay off more employees. The EU has imposed tariffs on EVs manufactured in China, claiming that the Chinese government unfairly provides subsidies to these vehicles.
The decision, which singled out Germany for its high labor and energy costs, reflected the continuous changes in the automotive sector, according to Marcus Wassenberg, managing director of Ford’s German division.
According to him, all German layoffs would take place at Ford’s major Cologne plant, which employs about 25% of the factory’s staff.
According to recent figures from the Society of the Irish Motor Industry (SIMI), the number of new automobile registrations increased by almost 10% in October, but the decline in sales of electric vehicles is still ongoing.
The data indicates a 9.7% increase in new car registrations to 2,423 last month compared to October of the previous year. Just 529 of these new vehicles were electric, a 12.3% decrease from the previous year.
The Nissan Leaf was the best-selling electric vehicle in October, while the Toyota Yaris Cross was the best-selling automobile. Along with the rise in new automobile registrations, there were 5,710 imported used cars registered in October, a 38.5% increase over the previous year. Imports are up 25.9% so far this year, totaling 53,448.
Automobile manufacturers are having difficulties. The decline in sales of electric vehicles coincides with ongoing difficulties for many automakers. Having trouble The German automaker Volkswagen is starting a reorganization that will result in the closure of at least three facilities, the reduction of all other locations in the nation, and a 10% pay cut for roughly 140,000 employees.
