Half of all Ford employees reside in North America. Yeah, this definitely isn't looking good.
After a record year and a few bouts of heavy investment, Ford has realized the obvious: what goes up must come down. By the prediction of nearly every analyst, the auto industry is entering a period of downturn. In order to brace itself for the changes, the Wall Street Journal reports that Ford is cutting 10% of its workforce in efforts to save over $3 billion during 2017. While these numbers are a reflection of cuts to be made across multiple regions, the fact that Ford has 50% of its employees in North America means the cuts will be felt deeply in the US.
With a total of 200,000 employees globally, the cut means that 20,000 Ford employees could get the bad news. The WSJ estimated that up to 10,000 of those layoffs could occur in the US if Ford evenly distributes the dismissals. Fortunately, the automaker issued a statement claiming that it would only axe 1,400 workers in the North America and Asian Pacific regions by September...for now. As CNN Money reports, regions like Europe and South America, which have already seen job cuts, will not suffer from further scaling back while Ford's focal points of growth like Africa and the Middle East will be left untouched. The news might not bode well for Ford's people, but at least the unions won't be mad.
That's because the workers to be fired are not hourly wage factory employees, it's the salaried white collar variety that will be getting the axe, though don't breathe too easy because the extent of Ford's budget cuts still remain unclear. The root of the problem lies with Ford's falling stock price, which has led once small competitors like Tesla to surpass it in terms of market valuation. It's a bit sad to see Ford have to scale back so drastically at a time when it recently has made heavy investments into its future, with checks being cut out for everything from an electric SUV and self-driving car to ride-share services. No mention on whether these, or any other enthusiast-friendly Ford projects, will be cut as well.