Electric cars, Ford flees the EU for Biden’s money in the US?
Ford will cut 3800 jobs in Europe, especially in Germany: the American company wants to reduce its costs while preparing the conversion to electric mobility. In the United States, however, it will invest more than 3 billion dollars for batteries. All the details
Ford will eliminate 3,800 jobs in Europe, to create 2,500 in the United States.
US automaker Ford has announced it will cut 3,800 jobs in Europe, or 11 percent of the regional total, to cut costs in the Old Continent and concentrate its technical capabilities in the United States.
The company is the largest in the European commercial vehicle market, but struggles to make a profit in the car segment. It had previously said it would be "very aggressive" in reducing spending on manufacturing and supply chains this year.
THE FORD EXECUTIVES' VERSION
CEO Jim Farley has explained several times that the production of electric vehicles – on which he is betting heavily, like virtually all automakers, to align with emissions policy goals – needs less manpower, due to fewer components, and significant cost cuts, to ensure the price competitiveness of the final product.
Martin Sander, head of Ford's electric vehicle division for the European market, said that “there is much less work to be done on the transmissions as we move away from combustion engines. We are moving towards a world with fewer global platforms, where less engineering work is required. That's why we need to make adjustments."
GERMANY WILL BE THE EUROPEAN COUNTRY MOST AFFECTED BY THE CUTS
The cuts mainly concern administrative and product development positions (engineers, developers, test drivers), and particularly affect Germany. In fact, of the 3,800 total jobs that will be eliminated, 2,300 will affect the Ford plants in Cologne and Aachen. Another 1,300 will go to the United Kingdom, and 200 to the rest of Europe. The company said it plans to meet the quota through voluntary exit programs.
The German metalworkers' union, IG Metall, teased Ford's plans last month. On that occasion, the representatives of the house spoke of the need to be "more competitive" in this phase of transition to electric mobility, also in light of the so-called "price war" launched by Tesla .
FORD'S NUMBERS IN EUROPE
In 2022, according to data from the ACEA (the association of European automobile manufacturers), Ford registered 516,614 cars in Europe, for a market share of 4.6 percent. But the company has set itself ambitious goals on electric vehicles: it wants to sell 600,000 of them in Europe by 2026.
At the moment, however – recalls Reuters -, the offer for this regional market is limited to two fully electric SUVs and the E-Transit van. However, Ford intends to offer seven new models by 2024: two will be built in Germany, in Cologne, and one in Romania.
The company has invested 50 billion dollars in the electrification of its offer, which will consist of a few models with higher prices than traditional ones, to compensate for the increase in production costs of this type of vehicle.
THE NEED FOR MANPOWER
Ford's chief financial officer, John Lawler, said European engineers were 25-30 percent below required levels of productivity. Chief Executive Officer Farley wondered “how many engineers, how many people do we need in Europe and how big a profile do we need in passenger cars?”.
Martin Sander, head of Ford Germany, explained during a press conference that the company will maintain approximately 3,400 engineers in Europe, who will base their work on core technology supplied by the US plants and adapt it to the needs of European customers.
The Dunton Research Center in southeast England will be the focus of Ford's workforce cuts in the UK.
THE GENERAL PLAN HAS NOT CHANGED, DESPITE THE CUTS
Despite the massive workforce cuts, Ford has specified that its plans for electric mobility in Europe will not undergo changes: that is, the goal remains to reach 2030 with an offer of electric cars only, to then electrify the entire fleet of vehicles by 2035.
Sander also said that Ford will launch its first European-made electric vehicle in Cologne in the coming months, based on Volkswagen's MEB platform. The company is also considering bringing its own platform to the continent, perhaps to its Valencia plant.
MEANWHILE, FORD INVESTS MASSIVELY IN THE USA
Alongside the 3,800 cuts in Europe, Ford on Monday announced a $3.5 billion investment in a battery factory in Michigan , US, that will create 2,500 jobs.
The automaker is targeting tax credits from the Inflation Reduction Act , and its move appears to align neatly with White House plans to reinvigorate industrial parks and "Americanize" supply chains in the green transition. But there is a problem: the technologies that will be used in the Ford plant are from the Chinese giant CATL. Several politicians have raised the risk of Washington ending up subsidizing Beijing, which already dominates the global market for batteries and many other clean energy technologies.
Last summer, Ford cut about 3,000 product development jobs in the United States, Canada and India.
INVESTMENTS IN EUROPE
Ford had said it intended to invest 2 billion euros in the Cologne plant, in order to prepare it for the production of electric vehicles, and 380 million pounds in the Halewood site in the United Kingdom, where it will make components for battery-powered cars.
However, he intends to sell the factory in Saarlouis in West Germany.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/smartcity/ford-taglio-posti-lavoro-europa/ on Wed, 15 Feb 2023 10:07:03 +0000.