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Ford to slash jobs in Europe, may close plants

13 January 2019

The automaker on Thursday said it will cut thousands of jobs, exit unprofitable markets and discontinue loss-making vehicle lines as part of a European reorganization, according to Reuters.

"We are looking to make a step-change in the performance of the business", Steven Armstrong, Ford's head of Europe, said Thursday in an interview with Bloomberg News.

Ford, which employs about 53,000 people in Europe across 15 plants, is said to be reviewing each of its European business in a bid to become more efficient in one of the world's most competitive markets. Like many other carmakers, Ford has warned it won't meet its forecasts for 2018, and Chief Executive Officer Jim Hackett jettisoned a goal to reach an 8 percent profit margin by 2020.

If it does so, Ford would follow the example of GM, which left Europe in 2017 after years of losses by selling Opel-Vauxhall to Peugeot.

If plans go ahead, the 990 jobs to be lost at Bridgend - nearly half of the site's workforce - will go in two phases by 2021, as part of 1,150 losses across the UK.

The company will stop production at a plant in Bordeaux, France, which makes automatic transmissions.

Discussions on autonomous vehicle development and sharing Volkswagen's MEB electric vehicle platform are said to be on-going.

Ford is now in talks with Volkswagen Group over a potential alliance, which could boost its strategic cost-cutting and boost its efforts to deliver an alternatively-fulled vehicle (AFV) drivetrain for each of its auto models.

Ford is expected to cut thousands of jobs across Europe, including the United Kingdom, as part of a major shake-up of its operations. Ford of Europe, based in Cologne, Germany, has 53,000 people working for it directly and 68,000 when joint ventures such as those in Russian Federation and Turkey are included.

Near term, Ford is accelerating key fitness actions and reducing structural costs.

Ford is in the midst of a massive, worldwide restructuring effort, and General Motors has also announced layoffs and plant closures in recent months.

Meanwhile Jaguar Land Rover says it will cut 4,500 jobs as the carmaker addresses slowing demand in China and growing uncertainty about the U.K.'s departure from the European Union.

Like many of its rivals, Ford has been caught out by a fall in the sale of diesel cars after VW's emission cheating scandal.

Ford confirmed it will get out of the family vans or MPV segment.

Ford of Europe will slash its workforce to improve its short-term profitability after losing US$199 million ($277 million) during the first three quarters of 2018.

The carmaker continues talks about a far-reaching alliance with Volkswagen in a deal that could increase Ford's manufacturing scale in commercial vehicles, Armstrong said.

Ford to slash jobs in Europe, may close plants