Ford To Trim 10 Percent Of Salaried Workers

DEARBORN, MI — Ford Motor Company announced plans to cut 1,400 salaried workers from its North America and Asia Pacific operations by the end of September Wednesday morning. The official word comes a day after speculation spread Tuesday that as many as 20,000 jobs could go.

"Reducing costs and becoming as lean and efficient as possible also remain part of that work, including plans to reduce 10 percent of our salaried costs and personnel levels in North America and Asia Pacific this year, using voluntary packages," Ford said in a statement.

Ford employs a total of about 15,000 salaried workers in the departments that will be affected with about 9,600 of those workers employed in the U.S., 1,000 in Mexico, 600 in Canada and 4,141 in Asia Pacific, the Detroit Free Press reported. Workers eligible for a voluntary reduction program will be offered early retirement and special separation packages through the end of September.

Ford said “most skill teams” in its North America and Asia Pacific regions will be affected by the cuts. Ford Credit and product development teams based in Dearborn will not be part of the cuts.

U.S. Congresswoman Debbie Dingell, a Dearborn Democrat representing Michigan’s 12th district, expressed concerns about the cuts Tuesday. “This would have a direct and significant impact on my district, which is the heart and soul of the auto industry and home to the hardest working men and women I know,” she said in a statement.

Auto industry analysts expects other automakers will soon follow Ford’s lead. “Ford is maybe the highest-profile company wrestling with cost and profits and unhappy investors,” Karl Brauer, executive publisher of Autotrader, told the Detroit News. “It’s hard for me to believe there’s no other automaker considering these types of moves.”

Media reports Tuesday said Ford management has been under increasing pressure from its board of directors and shareholders to do something to bolster sagging stock prices. Ford shares have dropped some 40 percent since CEO Mark Fields took the reigns of the company on July 1, 2014, according to a Detroit News report.

Ford shares were at $17.41 on Fields’ first day, and closed Monday at $10.94. That decline, and what appears to be softening sales, is the impetus for the belt-tightening. Ford's profits sank 35% during the first quarter of 2017 to $1.6 billion as higher costs for warranties, recalls and materials eroded profits, the Detroit Free Press reported.

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