DETROIT-Ford Motor Co. has confirmed plans to cut 10 per cent of its salaried jobs in North America and the Asia Pacific region this year, about 1,400 positions.
United States auto giant Ford is poised to cut thousands of jobs worldwide, with reductions expected to total about 10 per cent of its global workforce, the Wall Street Journal reported late yesterday.
Ford says that it has three priorities in its strategy, aiming to drive profitability and value. The automaker said on April 27 when it posted earnings for the first quarter than it was planning to cuts costs by $3 billion.
As Ford has hired more people in the past three years, largely in new technology projects General Motors has reduced its US workforce in response to lowered demand for cars, and has withdrawn from underperforming markets. They're also unsure about Ford's heavy spending on technology with an uncertain future, like its recent investment of $1 billion in Argo AI, an artificial intelligence startup. Ford has targeted approximately $3 billion in cuts in 2017, ahead of what many believe will be a flat period for U.S. auto sales.
Ford did not confirm the report to news agencies Monday evening. Ford said it expects it will hit the targets through voluntary offers, spokesman Mike Moran said.
Under pressure to cut costs, boost profits and to improve its stock price, Ford said it will announce its redundancies measures in the next few days.
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The job cuts are a part of a plan announced previously to slash $3 billion in costs, said the person in the know, as new auto sales in the US have been showing signs of slowing down following seven consecutive years of growth since the Great Recession ended.
Ford said in January it was cancelling a planned Mexico plant and adding 700 jobs in MI.
Today, Ford said it remains focused on its strategic plan to transforming traditionally underperforming areas of its core business and to investing in emerging opportunities, such as mobility and autonomous vehicles.
Only salaried workers in the US and Asia would be affected. "Car companies coming back to U.S. JOBS!"
"Look, we're as frustrated as you are by the stock price", Ford Executive Chairman Bill Ford said.
Ford's board scheduled extra meeting time ahead of last week's annual meeting to press him on his plans for reversing the company's fortunes.