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Ford to Cut At Least 1,000 Jobs to Offset Cost of Shifting to Electric Vehicles

The automaker has said it expects to lose $3 billion on electric vehicle business this year

Ford Motor Company is planning to terminate at least 1,000 salaried employees and contract workers to offset the cost of investing in electric vehicles.

Over the past year, the automaker has cut more than 3,000 jobs across the U.S., Canada, and India. The majority of the job losses were in Michigan, where Ford’s headquarters is located.

“People in certain agency positions across a few skill teams were notified by their employers that their assignments at Ford have ended,” Ford spokesman T.R. Reid told the Free Press. “The changes are consistent with the Ford+ plan aligning capabilities and roles with product and service priorities and, in the process, reducing costs.”

Ford has declined requests from multiple news agencies to provide numbers on exactly how many employees will be affected by the layoffs.

Last year, the company shed about 10,000 jobs globally, according to a public filing.

“Delivering our Ford+ plan for growth and value creation includes increasing quality, lowering costs, investing in our priorities, and adjusting staffing to match the capabilities we need,” the company said in an emailed statement to CNBC. “People affected by the changes will be offered severance pay, benefits and significant help to find new career opportunities.”

Cuts are expected across all three business units: Ford Blue (the company’s arm for vehicles with traditional combustion engines), Ford Pro (its commercial vehicle services and distribution business), and Model e (focusing on electric vehicles), The Verge reported.

“Delivering on the plan includes adjusting staffing to match focused priorities and ambitions, while raising quality and lowering costs. The actions we’re taking this week in the US and Canada are mostly (but not only) related to engineering roles,” T.R. Reid, Corporate & Public Policy Communications for Ford Motor, told The Verge. “People affected by the changes will be offered severance pay, benefits and significant help to find new career opportunities.”

Managers at Ford informed employees on Junr 26 that layoffs are coming and that employees who will be affected should work from home for the rest of the week, according to the Wall Street Journal (WSJ).

Earlier this year, the automaker said it expects to lose roughly $3 billion on electric vehicle business this year, in what WSJ said is “a reminder of how far traditional auto makers have to go in turning their EV portfolios profitable.”

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