Ford, Multinational Automaker, Announces Cut of 3,000 Jobs to Invest in Electric Cars

Multinational Ford Plans to Cut Over 3,000 Jobs to Become a Competitive Company in the Electric Car Sector and Compete with Tesla.

The Ford announced the cut of approximately 3,000 positions, mainly in India and North America, as it restructures to challenge Tesla in the race to develop electric cars and software. Jim Farley, CEO of the multinational, has stated that the company does not have enough employees with the precise skills needed to handle the industry that is shifting to electric cars and digital services.

Multinational Ford Plans to Generate More Revenue Through Digital Services

According to Farley and Ford’s president, Bill Ford, in an email, the company is eliminating jobs, reorganizing, and streamlining functions throughout the company. The executives state that business area leaders will provide details this week. Just like Tesla, led by billionaire Elon Musk, the multinational Ford plans to generate more revenue through services that depend on digital software and connectivity.

In the email to the team, Ford and Farley state that the multinational’s cost structure is not competitive compared to its old and new rivals. Rising prices of batteries, transportation, and raw materials are putting more pressure on Ford and other automakers. Nevertheless, the multinational maintained its profit forecast for this year, despite $3 billion in higher costs due to inflation.

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Leaders of the United Auto Workers union, representing employees of the automakers’ factories located in Detroit, expressed their concern that electric cars mean fewer jobs in manufacturing and more for battery and electric vehicle equipment factories, which do not have unions.

Multinational Ford Announces Company Dedicated to Electric Car Production

Earlier this year, Ford announced that it is separating its combustion vehicle and electric car business into two different companies. The change comes amid an increasingly rapid shift towards a future of electric models.

According to the official statement, the automaker continues to transform its global automotive business, driving the advancement and scaling of innovative electric and connected cars, while also reviving important names that had named its vehicles in the past.

In May of last year, Jim Farley presented the Ford+ plan, stating that this would be the greatest opportunity for expansion and value generation for the company since Henry Ford scaled up the production of the Model T. Now, the formation of two different companies, Ford Blue and Ford Model, will help put the full potential of this plan into practice, driving expansion in an increasingly competitive market.

New Electric Cars from the Multinational

The company detailed that the first step that will lead the brand to sell only electric cars in Europe by the next decade will be taken with the arrival of 3 new battery cars and 4 entirely new electric cars in the Old Continent.

The company plans to sell about 600,000 electric cars in Europe by 2026, the year when, globally, according to the announced plan, zero-emission vehicle sales worldwide will reach 2 million units.

Ford announced that the first vehicle to hit the market will be a medium SUV with 5 seats that will be built in Cologne, a factory that will serve as a true hub in Europe. In 2024, a sporty-profile electric crossover will also be built in Cologne, and in the same year, Ford plans to market the Electric Puma.