American carmaker, Ford Motor Co on Monday said it will eliminate about 10 percent of its global salaried workforce, which translates to around 7,000 people losing their jobs by end-August as part of its larger restructuring move that will help company save $600 million (Rs 4,171 crore) annually, reported Reuters.
According to the report, Ford CEO Jim Hackett in an email to the company’s employees said that reduction in workforce include both voluntary buyouts and layoffs, and a spokesman added it freezes open positions as well. The move is said to affect 2,300 employees in the United States alone.
“To succeed in our competitive industry, and position Ford to win in a fast-changing future, we must reduce bureaucracy, empower managers, speed decision making, focus on the most valuable work and cut costs,” Hackett said in the email, reported Reuters.
The development is said to be part of the carmakers global restructuring plans to improve profitability and faster product development.
In January 2019, Ford had announced its alliance with Volkswagen AG to develop commercial vans and medium-sized pickups for global markets beginning as early as 2022. The companies estimate the commercial van and pickup cooperation will yield improved annual pre-tax operating results, starting in 2023. In addition, Volkswagen and Ford have signed a memorandum of understanding to investigate collaboration on autonomous vehicles, mobility services and electric vehicles and have started to explore opportunities.
The report further said that within the job cuts, Hackett said it will eliminate close to 20 percent of upper-level managers, a move intended to reduce bureaucracy and speed up decision making. Before the revamp of its operations, Ford had up to 14 organisational layers that will be cut to nine by year-end, Hackett said.
What’s interesting to see despite slowdown in its global sales, Ford Motor’s India operations continue to be the leading exporter for the second year in a row.
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