Ford Is Lowering Costs By Cutting Hundreds Of Engineer Jobs
Ford is reportedly planning to lay off a good chunk of salaried U.S. workers – most of whom are engineers – this week in an effort to lower costs as the automaker sets out on its $50 billion shift to electric vehicles. Despite the focus on electric vehicles, the engineering cuts are happening in all three parts of its business, including EVs. According to Bloomberg, cuts are also taking place in the internal combustion engine unit as well as the commercial vehicles division.
This move isn’t exactly unexpected. Earlier this year we reported that Ford CEO Jim Farley said the automaker had 25 percent more engineers than other companies doing the same amount of work. He said it was costing the company billions in profit. Ford hasn’t said how many workers it is cutting, but they are going to be informed on Tuesday and Wednesday . P eople familiar with the matter have told Bloomberg that it’ll be somewhere in the hundreds. So, I guess Jimbo is getting his way.
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“We’re not cost competitive. We have specific priorities and ambitions that have implications for skills, assignments, and staff needs. These changes are consistent with that.” T.R. Reid, a Ford spokesperson, told Bloomberg. “They’ll make us cost effective.”
Ford has reportedly said it will lose $3 billion in 2023 on its EV business, but Farley has promised that battery-powered vehicles would generate an 8 percent return, before interest and taxes, by the end of 2026. Ford wants to build 2 million EVs a year by that date. It’s a big jump from the approximately 130,000 EVs the Blue Oval sold in 2022.
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Last week, the automaker and its South Korean battery partner – SK On – re ceived a $9.2 billion loan from the U.S. Department of Energy. The money is going to the construction of three battery plants in Kentucky and Tennessee. The people getting laid off are probably thrilled about all that.
Source: Jalopnik
