Ford to cut hundreds of jobs in Europe to boost profitability
US auto giant Ford plans to cut hundreds of jobs in Europe in a bid to strengthen profitability in the region, it said Wednesday, just days after turning in its first annual profit in years.
Frankfurt: US auto giant Ford plans to cut hundreds of jobs in Europe in a bid to strengthen profitability in the region, it said Wednesday, just days after turning in its first annual profit in years.
A plan for voluntary layoffs was presented to the workforce today, a company spokesman said, but declined to provide any concrete numbers or timetable for the job cuts.
But in an interview to several different media, the head of Ford of Europe, Jim Farley, put the figure in the "hundreds" out of a total workforce in the region of around 10,000.
In a statement, Ford said that "after returning to profit in 2015, Ford of Europe is accelerating its plan to deliver a vibrant and sustainably profitable business."
The carmaker is targeting "higher profit and pre-tax operating margin in 2016 and six-to-eight percent operating margin in the longer term," it said.
"In the past three years, Ford of Europe has improved its business in all areas and moved from deep losses to a USD 259-million profit in 2015. This is a good first step," Farley said.
"Ford today initiated a voluntary separation programme in Europe supporting a significant reduction in administrative and selling costs. With the move, Ford of Europe expects to save about USD 200 million a year on an ongoing basis," he said.
In the past, Ford has substantially downsized production capacity in Europe, shutting three factories, including Genk in Belgium which employed a workforce of 4,300.