Business

Ford to cut 12,000 jobs in Europe

Workers at Ford's Bridgend plant Image copyright Reuters
Image caption Ford's Bridgend site is one of the European plants closing

Car giant Ford has said it is planning to cut about 12,000 jobs across its European operations by the end of 2020.

The carmaker is trying to cut costs and restructure its European business, which is losing money.

It plans to have closed five of its plants by the end of next year, including the Bridgend engine plant in Wales, and it is selling another.

Ford, which employs 51,000 people in Europe, hopes to achieve most of the cuts through voluntary redundancy.

The whole car sector is currently struggling to cope with weak or falling demand in major markets, and the huge investments required for the shift towards electric vehicles.

Ford said that of the 12,000 jobs affected, 2,000 were salaried roles, which are among the previously announced 7,000 salaried jobs that are being cut worldwide.

"Separating employees and closing plants are the hardest decisions we make, and in recognition of the effect on families and communities, we are providing support to ease the impact," said Stuart Rowley, president of Ford of Europe.

"We are grateful for the ongoing consultations with our works councils, trade union partners and elected representatives.

"Together, we are moving forward and focused on building a long-term sustainable future for our business in Europe."

It's tough out there

Analysis by Theo Leggett, business correspondent

Image copyright Getty Images

The planned closure of Ford's plant in Bridgend is just part of a much wider picture, and one which shows just how difficult life has become for the US giant in Europe.

This isn't the first time its European business has undergone major surgery over the past decade. Previous restructuring efforts also saw factories closed and thousands of jobs lost.

There was a turnaround of sorts, leading to a healthy profit in 2016. But since then the trend has reversed, and the division has been struggling once again.

At the same time, Ford needs to free up cash, so that it can invest in electric and hybrid cars. That will be essential if it is to meet new EU emissions targets which apply from 2021.

So the axe is being swung, and swung hard. But for the moment, Ford does seem confident a slimmer business in Europe can prosper.

It's worth remembering that another US giant - General Motors - recently gave up on its European businesses altogether. It's tough out there.

Ford plans to have shed six manufacturing plants by the end of next year. These include:

  • The proposed closure of the Bridgend Engine Plant in south Wales
  • The closure of the Ford Aquitaine Industries Transmission Plant in France
  • The closure of the Naberezhnye Chelny Assembly, St Petersburg Assembly and Elabuga Engine Plant in Russia
  • The sale of the Kechnec Transmission Plant in Slovakia to Magna.

The company is also carrying out shift reductions at its assembly plants in Saarlouis, Germany, and Valencia, Spain.

Electric future

Ford said its European operations would be reorganised, with three "customer-focused" business groups for commercial vehicles, passenger vehicles and imports.

The commercial vehicles business will be based at Dunton in the UK.

The company also said that every new Ford car brand would include an electric option.

"Our future is rooted in electrification," said Mr Rowley.

"We are electrifying across our portfolio, providing all of our customers with more accessible vehicle options that are fun to drive, have improved fuel economy and are better for our environment."

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