Ford is cutting 7,000 white-collar jobs

Lloyd Doyle
May 22, 2019

Ford Motors plans to globally slash 7,000 managers' jobs by this August, which equates to about 10 per cent of its white-collar workforce across the globe.

In a statement issued from the United States auto giant's Detroit headquarters on Monday, Ford announced it was nearly at the end of its global restructuring program.

The plan is to shed 2,300 jobs through buyouts and layoffs in the USA, 1,500 of which have already been made.

Ford has been struggling financially, and 1,500 employees took voluntary buyouts past year. Some contract employees in the USA also will be let go.

About 6,000 blue-collar positions were cut, but most of the laid-off factory workers in the U.S. will be placed at other plants mainly that build trucks and SUVs.

Unlike the media coverage of the news which brings the job losses to the forefront, Ford's internal email communication - published by CNBC in full here - is titled "Smart Redesign Update", and doesn't mention salary cuts until two-thirds of the way through the document. Trump campaigned on bringing factory jobs back to the industrial Midwest. Earlier this month, GM said it was in talks to sell an OH plant to Workhorse, a Cincinnati-based company that focuses on producing electric delivery vehicles. The company had roughly 199,000 employees across the world at the end of last year, about 3,000 less than the previous year, according to a securities filing.

In a statement, Ford said the layoffs are part of the company's "organizational redesign", adding that the plan is near completion in relation to job cuts. Many have been upset that it took so long for the company to make decisions.

Most of Ford's white-collar workers are in and around the company's Dearborn, Michigan, headquarters. In the past, laid-off workers would have had to pack up and leave immediately.

Ford acknowledged in the company email that saying goodbye to colleagues is hard and emotional. The CEO claims the changes will reduce "management bureaucracy by one third". The Detroit News reported this morning that the first of 500 Ford salaried employees are expected to be notified in meetings today that they're being let go.

The dismissals are created to shrink Ford's management structure by 20% and streamline the number of organisational layers to nine or less, from 14, Hackett said.

Jim Hackett, Ford's CEO, also had to struggle with the battle of lifting the company's performance in the stock market which was the major reason behind the $11 billion restructuring.

Notification to North American employees will begin on Tuesday and the majority will be completed by May 24, he said.

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

Other reports by Iphone Fresh

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