Ford to go through $11 Bn restructuring, employees may face job cuts
In a bid to reverse its fading fortunes as Ford Motor Co. goes through $11 Bn restructuring, its 70,000 salaried employees may face unspecified job cuts.
Karen Hampton, a company spokeswoman shared that Ford has told its employees that they are in the early stages of an organizational redesign of the global salaried workforce. She revealed, "The goal is that gradually you’re getting a wider, flatter organization that is really designed for speed. Inevitably, we expect that to result in some reductions, but at this point, there’s no target.”
Morgan Stanley speculates that Ford may shed more than 20,000 jobs from its global workforce of 2,02,000. However, the automaker has not yet quantified how large it expects the salaried reductions to be or if it would involve any involuntary separations. Ford also couldn’t estimate the financial impact or say whether it will take any charges for the program.
Regions that seem to be struggling the most may see the deepest cuts, Karen revealed. As per reports, Ford is losing money in Europe, Asia and South America, with only its operations in North America turning a profit, thanks primarily to its F-Series pickup line. In July, the US automaker cut its profit forecast for 2018 after second-quarter earnings fell by more than half.
Earlier it was also reported in the Detroit News that Ford is seeking to cut more than $25 Bn in costs and that some of that cost reduction will come by shrinking its salaried workforce.
However, Chairman Bill Ford remains optimistic amidst crisis and said, "I don’t think it’s even close to a crisis. We’re making good profitability."
He adds,“Do we still have work to do? Yes, we do. But we are investing heavily in the product. We’re investing heavily in the future. And there’s nothing that we want to do that we can’t do.”