Ford Europe slashes staff headcount by 3,800

Ford of Europe today announced redundancies across the continent, 1,300 of which will go from the UK

By John Howell / Tuesday, 14 February 2023 / Loading comments

More doom and gloom. This time it’s the anticipated job cuts from Ford of Europe, which is axing 3,800 roles from administrative and product development across the continent. It’s the third round of European job cuts from the US brand in the last five years, after it slashed its headcount in 2019 and 2020. That was to raise its operating margin to six per cent – a goal that was inevitably missed thanks to the pressures of the pandemic and semi-conductor shortages, leaving them at 2.2 per cent for the first nine months of 2022.

This round of cuts will be spread over the next three years and, where possible, Ford has said it intends the redundancies to be voluntary. The plan is to reduce its staffing by 2,300 in Cologne and Aachen, Germany, 1,300 people from the UK (that’s roughly one-fifth of its workforce here), and a further 200 people from across the rest of its facilities in Europe. That still leaves around 3,400 engineers based in the region.

The reasons given are rising costs within its operations, which include the inflationary pressures resulting from wage increases, higher interest rates and higher energy costs, but it’s also looking to slim down its workforce as the company shifts to exclusively EV production. The intention is that this will happen by 2030, while the majority of its commercial products will be a mix of BEV and hybrid by then.

At the same time, it’s slimming down its lineup. The Mondeo has already been killed off, and we know that the Fiesta and Focus will come to an end in the very near future. Instead of those volume models, it’s looking to sure up profits by focusing on more high-end vehicles. Fewer models means fewer people to needed develop them, a fact compounded by the simplicity of electric drivetrains, which don’t require such large teams to engineer.

On top of that, it is buying in or co-developing platforms from other companies – the new Ranger shares its underpinnings with the Volkswagen Amarok and its next EV will be based on VW’s MEB platform. Even so, developing a range of new electric vehicles is, as we know, very costly. Ford has recently announced plans to invest $50b (£41b) into EV production, with $3.5b (£2.9b) earmarked for its first battery plant in the US.

In the UK, the majority of the cuts will be at Ford’s research site at Dunton, Essex. It’s sites Dagenham and Daventry will not be affected, and nor will Halewood, which has had a £380m investment to swap from gearbox manufacture to making electric motors. £125m of that came as recently as December 2022.

Martin Sander, General Manager of Ford Model e in Europe, said, “These are difficult decisions, not taken lightly. We recognize the uncertainty it creates for our team, and I assure them we will be offering them our full support in the months ahead. We will engage in consultations with our social partners so we can move forward together on building a thriving future for our business in Europe”.

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