Ford Motor Co. will reduce its European workforce by 4,000 employees by the end of 2027, citing economic pressures, weaker-than-expected electric vehicle (EV) sales and growing competition in the EV market, AAP reports.
The restructuring will mainly affect employment in Germany and the United Kingdom, with a smaller impact in other European Union countries.
The carmaker announced on Wednesday that 2,900 jobs will be cut in Germany, 800 in Britain and 300 elsewhere in Europe. The reductions will be implemented in consultation with employee representatives. Ford currently employs 28,000 people across Europe and 174,000 worldwide.
Ford attributed the job losses to significant disruptions in the global auto industry as it transitions to electrification. In a statement the company said:
“The transformation is particularly intense in Europe, where automakers face significant competitive and economic headwinds while also addressing a misalignment between CO2 regulations and consumer demand for electrified vehicles.”
European car manufacturers are under pressure to meet strict limits on carbon dioxide (CO2) emissions. New fleet-wide emissions standards will come into force in 2025, with the EU’s longer-term target to reach zero emissions by 2035, effectively phasing out most combustion engine vehicles.
However, according to industry data, electric vehicle sales in the region have been sluggish, down 5.8% in the first nine months of the year. Germany, Europe’s largest car market, recently cut government subsidies for the purchase of electric vehicles, dampening consumer demand.
At the same time, European car manufacturers face increasing competition from Chinese EV manufacturers offering cheaper alternatives. Ford’s European sales fell 15.3% in the first nine months of 2024, dropping its market share to 3% from 3.5% in the same period in 2023, according to the European Automobile Manufacturers’ Association (ACEA).
Ford plans to reduce working hours at its plant in Cologne, Germany, where it produces the Capri and Explorer EV models. The company’s global net profit also fell 26% to $892 million in the third quarter, partly due to a $1 billion charge for halting a planned electric SUV project.
Ford Vice Chairman and CFO John Lawler recently urged the German government to implement clearer policies to support the EV transition. In a letter, Lawler stressed the need for greater public investment in charging infrastructure, consumer incentives and more flexible carbon compliance targets to secure the future of the European automotive sector.
