Ford said Tuesday that it will cut 3,800 jobs in Europe over the next three years in an effort to streamline its operations as it contends with economic challenges and increasing competition on electric cars.
The automaker said 2,300 jobs will be eliminated in Germany, 1,300 in the United Kingdom and 200 elsewhere on the continent. It said its strategy to offer an all-electric fleet in Europe by 2035 has not changed and that production of its first European-built electric car is due to start later this year.
The Dearborn, Michigan-based company said it is looking for “a leaner, more competitive cost structure for Ford in Europe.” The automaker will embark on consultations “with the intent to achieve the reductions through voluntary separation programs.”
The job cuts come amid a sea change in the global auto industry from gas-guzzling combustion engines to electric vehicles. Governments are pushing to reduce the emissions that contribute to climate change, and a resulting race to develop electric vehicles has generated intense competition among automakers.
It’s even stirred tensions among Western allies as the U.S. rolls out big subsidies for clean technology like EVs that European governments fear could hurt homegrown industry.
Ford aims to cut 2,800 of the European jobs in engineering by 2025 as a result of the transition to electric cars that are less complex, though it plans to keep about 3,400 engineering jobs on the continent. The remaining 1,000 jobs will be cut on the administrative side.
“Paving the way to a sustainably profitable future for Ford in Europe requires broad-based actions and changes in the way we develop, build and sell Ford vehicles,” Martin Sander, general manager of Ford’s Model e unit in Europe, said in a statement. “This will impact the organizational structure, talent and skills we will need in the future.”
“These are difficult decisions, not taken lightly,” he added. “We recognize the uncertainty it creates for our team, and I assure them we will be offering them our full support in the months ahead.”
Ford also announced in August cuts of about 3,000 white-collar jobs in North America as it reduces costs to help make the long transition from internal combustion to battery-powered vehicles.
In a step in that direction, it said Thursday that it plans to build a $3.5 billion factory in Michigan that would employ at least 2,500 people to make lower-cost batteries for new and existing EVs.
Company officials reported that its net income fell 90% in the last three months of 2022 from a year earlier. It said costs were too high and that it contended with a global shortage of computer chips and other parts used in its vehicles.
In Europe, Ford has some 34,000 employees at wholly owned facilities and consolidated joint ventures.