Ford to ax at least 1,000 contract, salaried workers to offset billion-dollar EV investments

Ford Motor Co. reportedly has plans to fire at least 1,000 salaried and contract workers as the auto giant looks to offset the cost of investing in the electric vehicle market.

During internal meetings on Monday, salaried workers based in North America were informed of the impending job cuts, which are expected to significantly affect engineers, people familiar with the matter told The Wall Street Journal.

A spokesman for the Detroit-based automaker confirmed the news to the outlet on Tuesday, adding that firings will be focused in the engineering, gas-engine and commercial-vehicle divisions.

Managers told the employees on affected teams that they should work from home for the rest of the week, The Journal reported.

“We didn’t provide a number to The Journal or confirm its speculation,” a Ford spokesman told The Post.

“These actions are related to the Ford+ growth plan we introduced in 2021 and have been increasingly implementing over the past year,” he added.

The spokesman continued: “Delivering on the plan includes adjusting staffing to match focused priorities and ambitions, while raising quality and lowering costs. What we’re doing this week in the US and Canada is mostly, but not only, related to engineering roles. People affected by the changes will be offered severance pay, benefits and significant help to find new career opportunities.

The move comes after Ford touted its “ambitious, comprehensive plan to make the transition to an electric lifestyle” on its website, noting that it has plans to invest “more than $50 billion in electric vehicles globally through 2026.”

The automaker has already introduced an electric truck, dubbed F-150 Lightning, with four models that range from $59,974 to $98,074.

Though Ford’s revenues were up 20% year-over-year for Q1 of 2023, sales of the F-150 Lightning haven’t been up to par.

About 4,300 units of the electric truck were sold in this year’s first quarter — about 2,000 less than projected — as Ford’s most popular F-150 gas-powered line sold over 170,000 units during that same time period.

However, the lack of EV revenue hasn’t stopped Ford from persevering in the market.

In April, Ford announced a $1.3 billion venture to transition its Oakville Assembly Plant in Ontario, Canada, into the Oakville Electric Vehicle Complex.

The six-month turnover will kick off in Q2 of 2024.

Once complete, the facility will produce next-gen EVs that will hit the market in 2025.

Most recently, Ford announced that it reached a deal with its EV rival Tesla where Ford EV drivers will have access to more than 12,000 Tesla Superchargers throughout the US and Canada, effective sometime in 2024.

With lots of costly EV efforts underway, Ford has made several rounds of global layoffs in a bid defray the massive cost of shifting from internal combustion to EVs.

Last August, the US automaker slashed 3,000 white-collar jobs.

At the time, executive chairman Bill Ford and CEO Jim Farley said in the email that Ford will provide benefits and significant help for the workers to find new jobs.

Then in February, the Michigan-based automaker announced that it’s going to hand 3,800 Europe-based staffers pink slips over the next three years.

In 2022, Ford employed a total of about 173,000 people — down 5.46% from its 183,000 workers in 2021.

The 2021 figure was 1.61% lower than Ford’s workforce in 2020.

Though Ford’s profits have been healthy, it’s unclear if it can be attributed to the layoffs.

According to its Q1 2023 earnings report, Ford’s revenue was $41.5 billion, up 20% from the same period in 2022, when profits were $34.5 billion.

Despite news of the most recent layoffs, Ford’s share price closed up 2.2%. Year-to-date, shares have climbed 23%.