Ford cutting 7,000 white-collar jobs despite healthy profits

Darnell Taylor
May 20, 2019

Ford plans to eliminate about 7 000 salaried jobs - about 10% of its global white-collar workforce - as pressures mount on automakers to keep pace with massive technological shifts amid signs global auto demand has peaked.

Hackett's email to employees laid out Ford's "Smart Redesign" plan, which aims to "reduce bureaucracy, empower managers, speed decision making, focus on the most valuable work, and cut costs".

Ford announced Monday that they would be laying off about 500 white collar employees in the USA, mostly in Dearborn, with more cuts globally.

Ford had signaled it expected significant job cuts in April 2018 when it announced a plan to phase out several small models in North America. About 500 USA workers will be let go this week.

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

The move, which began previous year, will lead to 800 layoffs in North America in total, including about 500 this week, said Ford spokeswoman Marisa Bradley.

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The Dearborn, Michigan-based automaker expects the move to save about $600 million annually, and has been in the works for the past year. About 5,000 blue-collar positions were cut, but most of laid-off factory workers in the USA will be placed at other plants mainly that build trucks and SUVs.

Both companies have said the cuts are needed because the companies face huge capital expenditures to update their current vehicles and develop them for the future.

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. GM has since announced a possible deal to sell the Lordstown plant to a startup electric vehicle maker, but it hasn't been finalized.

"We have moved away from past practices in some regions where team members who were separated had to leave immediately with their belongings, instead giving people the choice to stay for a few days to wrap up and say goodbye".

Ford shares briefly moved higher before the start of regular trading but were down 0.3% to $10.26 as of 10:15 Monday in NY trading.

"Ford is a family company and saying goodbye to colleagues is hard and emotional", Hackett said in the email.

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