Ford plans to cut about 10% of global workforce
Ford Motor Co. plans to cut about 10 percent of staff worldwide as Chief Executive Officer Mark Fields faces escalating pressure to boost profit and a lagging stock price, the Wall Street Journal reported.
The job cuts are expected to be outlined as early as this week and mostly target salaried employees, the newspaper said, citing unidentified people briefed on the plan. It’s unclear if hourly factory workers are included, the Journal said.
Ford shareholders last week criticized company leaders over what one investor called the “pathetic” performance of the automaker’s shares and questioned how the board can continue to support Fields, who’s been CEO since July 2014. The board scheduled extra meeting time ahead of last week’s annual meeting to press him on his plans for improving the company’s fortunes, a person familiar with the discussions said.
“We have not announced any new people efficiency actions, nor do we comment on speculation,” Ford said in an emailed statement.
Fields is facing sharp questioning of his strategy with Ford’s shares having fallen about 36 percent since he replaced Alan Mulally, who steered the company through the global financial crisis without a government bailout. Fields has been pouring billions into electric autos, self-driving cars and ride-sharing experiments as its conventional vehicle business has struggled more so than crosstown rival General Motors Co. amid a slowing U.S. market.
Ford’s first quarter adjusted earnings fell 42 percent, while GM has said it remains on track for another record annual profit. Fields has said Ford will cut costs by about $3 billion this year and that earnings will rebound in 2018.
Any retrenchment by Ford in the U.S. would expose the carmaker to risk of more criticism from Donald Trump. Fields and Executive Chairman Bill Ford have curried favor with the president this year, giving him advance notice of hiring and investment at U.S. plants and canceling a small-car factory in Mexico. Trump has pointed to carmakers’ plans and claimed they’re restoring American manufacturing because of him.
Ford employed about 201,000 workers as of the end of last year, including about 101,000 in North America, according to a regulatory filing.