Ford job cuts beginning this week, leading to 7,000 cuts globally
DEARBORN, Mich. (FOX 2) - Employees at Ford Motor Co. are bracing for hundreds of new job cuts starting this week.
In an email sent to employees that was given to FOX 2, officials said another wave of their redesign process will begin on Tuesday, May 21 and will be completed by Friday.
Daniel Barbossa with Ford tells us 900 cuts will be happening globally this week, with 500 of those happening in the United States, largely in and around the company's headquarters in Dearborn, Michigan, just outside Detroit.
The redesign process will continue through the summer, and by late August Ford says they'll have eliminated about 7,000 salaried positions across the globe. That's about 10% of its total salaried workforce, and will save them about $600 million a year. This has included both voluntary and involuntary separations, Ford said.
Throughout the continuing elimination process this summer, 300 more job cuts will take place in the U.S., for a total of 800 in the redesign process.
Ford says the job cuts eliminate bureaucracy and increase the number of workers reporting to each manager.
Ford acknowledged in the company email that saying goodbye to colleagues is difficult and emotional.
"We have moved away from past practices in some regions where team members who were separated had to leave immediately with their belongings, instead giving people the choice to stay for a few days to wrap up and say goodbye. We also have a range of resources and services in place to support employees in managing this transition," the email reads.
Ford's white-collar employees had been fearful since last July when the company said the restructuring would cost $7 billion in cash and hit pretax earnings by $11 billion over the next three to five years. Many have been upset that it took so long for the company to make decisions.
Factory workers have not been affected by the restructuring thus far, as the company has retooled car plants so they can build more popular trucks and SUVs.
This is the second set of layoffs for Detroit-area automakers, even though the companies are making healthy profits. Sales in the U.S., where the automakers get most of their revenue, have fallen slightly but still are strong.
In November, General Motors announced it would shed up to 14,000 workers as it cut expenses to prepare for a shift to electric and autonomous vehicles. The layoffs included closure of five factories in the U.S. and Canada and cuts of another 8,000 white-collar workers worldwide. About 6,000 blue-collar positions were cut, but most of laid-off factory workers in the U.S. will be placed at other plants mainly that build trucks and SUVs.
Both companies have said the cuts are needed because the companies face huge capital expenditures to update their current vehicles and develop them for the future.
The Associated Press contributed to this report
An earlier version of this story incorrectly reported the job cuts were beginning on Monday, May 20.