American multinational automaker Ford on Thursday, January 10, said that it would cut jobs across Europe as a part of its restructuring plans.
While the automaker did not specify the number of employees that would be affected, it did reveal that the number could go up to "thousands," and would include salaried as well as hourly workers. Ford also said that the job cuts would be discussed with labour unions and would have an impact on all the departments in the company.
Ford, in a statement, said that "structural cost improvements will be supported by a reduction of surplus labor."
Speaking of the job cuts, Steven Armstrong, Ford's head of Europe, told Bloomberg News, that the company is looking to bring about significant changes and plans to concentrate on models that are profitable and shut down those that haven't worked for the brand.
"We are looking to make a step-change in the performance of the business. There'll be significant impact across the region. We will be looking at all options," he explained.
"We will invest in the vehicles, services, segments and markets that best support a long-term sustainably profitable business," Armstrong added. He also revealed that Ford now plans to shift its focus to electric cars and said that every model will now have a battery-operated version.
Apart from the job cuts, the Dearborn, Michigan-based company also plans to shut down a few of its plants. The car maker has said that it would close a factory in Bordeaux, France, at the end of August 2019 and will also stop producing two of its mini vans at its factory in Saarlouis, Germany, reported the New York Times.
The auto industry has been feeling the strain of a lower demand and stringent emission rules and it is not just Ford that is looking to cut jobs. Jaguar Land Rover (JLR) has also confirmed that it is set to cut about 4,500 jobs, mostly from the United Kingdom.
JLR is known to have cut some 1,500 jobs in 2018 and the latest round is likely to affect the office roles in the company as it aims to restructure its managerial positions. Britain's biggest carmaker has been facing issues in terms of European sales and also fears that it will see a double-digit drop in demand in China.
"We are taking decisive action to help deliver long-term growth, in the face of multiple geopolitical and regulatory disruptions as well as technology challenges facing the automotive industry," BBC quoted JLR's chief executive Ralf Speth as saying.
Since the news of the job cuts broke, JLR employees are known to be concerned about what the future holds. An engineer, on condition of anonymity, told the BBC that he was "unsure" of his job and that the management's communication was "cryptic."
"It's not clear what's going on," he said, while another employee added: "If they're going to cut down on the work, then we're going to lose work. So the future doesn't look that great at the moment for any of us."
Suppliers too are said to be worried. "If they're cutting down on important jobs like the design functions and things like that, where is the future of the business going," John Nollett, managing director of metal supplier Pressmark Pressings, in Atherstone, Warwickshire, said.