Ford to axe 800 UK jobs as part of European cuts
Ford is set to cut 800 jobs in the UK over the next three years, part of a larger plan to reduce 4,000 positions across Europe by the end of 2027. This move is aimed at addressing financial losses and adapting to the challenges posed by electrification and competition. Lisa Brankin, managing director of Ford of Britain and Ireland, expressed the gravity of the decision: “It’s not the news anyone wants to hear at any time. So our aim is to try to deliver this through voluntary redundancy.”
Despite the significant cuts, Ford reassured that its power unit plants at Dagenham in Essex and Halewood in Merseyside will remain untouched. These facilities are vital to the company’s operations, with Dagenham focusing on diesel engine production while preparing for a major electric vehicle motor manufacturing facility. Six other UK sites, including the Dunton Research and Development Center, are under review and could face workforce reductions. Administrative, support, and product development roles are most at risk, reflecting a broader strategic shift in Ford’s European operations. The cuts come at a time when the company is grappling with steep losses in its European passenger vehicle division.
The restructuring highlights Ford's attempt to cut costs in the face of mounting losses and market disruptions. The company cited the transition to electric vehicles as a significant challenge, with new market entrants and fierce competition making profitability increasingly elusive. Ford’s passenger vehicle division in Europe has reportedly been unprofitable for years, necessitating decisive action.
The rise of electric vehicles (EVs) in Europe has not been without hurdles. Ford faces stiff competition from Chinese automakers offering competitively priced EVs. Coupled with consumer concerns about charging infrastructure and costs, these factors have slowed EV adoption and complicated Ford’s efforts to establish itself as a premium electric car brand.
Ford’s discontinuation of the Fiesta last year marked the end of an era and a shift in its strategy. After nearly five decades, the brand retired its best-selling model as it pivots toward producing electric and higher-end vehicles. The change underscores Ford’s challenges in redefining its identity amidst market pressures.
Ford isn’t the only automaker struggling with the changing landscape of Europe’s car market. Volkswagen, Mercedes-Benz, and BMW have all faced declining profits this year, exacerbated by high energy costs and weaker-than-expected EV demand. Volkswagen is even contemplating the closure of some German factories, illustrating the severity of the industry-wide crisis.
Halewood is at the center of Ford’s electrification plans, with a new facility for producing electric motors nearing completion. The site will play a crucial role in supporting Ford’s long-term strategy, even as the company downsizes elsewhere. Investments like this reflect Ford’s determination to build a resilient business for the future.
In the UK, car manufacturers are navigating the challenges of meeting the government’s Zero Emission Vehicle (ZEV) Mandate. This policy requires 22% of all cars sold to be zero-emission vehicles in 2024, with incremental increases each year. Manufacturers failing to meet these quotas could face fines of up to £15,000 per non-compliant car, adding further pressure to the already-strained automotive sector.
Ford’s European vice president for transformation, Dave Johnston, emphasized the importance of these strategic changes, stating: “It is critical to take difficult but decisive action to ensure Ford's future competitiveness in Europe.” Despite the setbacks, the company remains committed to adapting and thriving in an evolving market dominated by electrification and innovation.
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