Where Ford will slash jobs in Europe

Ford's technical center in Merkenich, Germany, will bear the brunt of job cuts.

Ford's latest round of jobs cuts in Europe will mostly affect its German operations but the company's UK workforce will also be impacted, press reports said.

Ford plans to restructure in Europe as the automaker drops its traditionally high-selling but low-margin passenger cars including the Focus and Fiesta to switch to crossovers, SUVs and all-electric vehicles.

The company wants to ax about 65 percent of jobs in product development and hundreds of administrative roles, with German locations most affected, the IG Metall union said on Monday, vowing action that would disrupt Ford production if the cuts go ahead.

At Ford's technical center in Merkenich, 2,500 of the 3,800 jobs could go. The center does development work for the Fiesta small car and Focus compact model, which are being phased out. Ford currently employs 6,250 people in product development in Europe. Its next-generation EVs, due after 2030, will use a new, software-defined architecture developed in the U.S., which means less work for its engineers in Germany.

About 700 jobs, or 20 percent of the workforce, could be cut at Ford's European headquarters in Cologne and about 1,200 jobs will be axed at the spare parts business, also in Cologne, that supplies the automaker's dealer network. Ford's future electric cars will need fewer parts than its current combustion engine cars.

Jobs will also be cut at Ford's research center in Aachen, Germany, which mainly works on combustion engines, at the Ford technical center in Dunton in the UK, which works on commercial vehicles, and at the Lommel Proving Ground in Belgium, local press reports said.

Ford could cut jobs at its Lommel Proving Ground in Belgium. Shown are 1,326 Mustangs brought to the track in 2019 to set a world record for the most Ford Mustang sport cars in a single parade.

The company is spending $2 billion to convert its Cologne plant to build two battery-electric cars based on Volkswagen Group's MEB platform.

The Cologne plant will stop building the Fiesta small car in June. Production of the first MEB-based EV will start at the factory in October. A second model will follow next year. Ford has a partnership with VW to produce 1.2 million vehicles on the MEB electric platform over six years.

As part of its EV push, Ford plans a total of seven new electric models in Europe, along with a battery-assembly site in Germany and a nickel cell manufacturing joint venture in Turkey.

Ford warned in June last year of "significant" job cuts to come as the shift to EV production meant it would require fewer labor hours to build cars. Ford will stop building the Focus at the Saarlouis plant in Germany, which employs about 4,600 people, by 2025 with no plans to produce any other cars there after that. All but 500 to 700 of the jobs there will go.

Ford said in August that it is delaying its production investments in Valencia, Spain, where it plans to build its next-generation electric vehicles, due to Europe's worsening economic outlook.

A spokesperson at the automaker's headquarters in Michigan said on Monday that discussions with the German works councils were continuing and that the company needs to be "more competitive" as it transitions to EVs. He would not comment on specific job plans.

Ford teased the look of its first EV based on VW's MEB platform in December. Production will start in Cologne this year.

Workers were told to expect concrete numbers of job losses from the automaker in mid-February, according to Cologne's daily paper, the Kölner Stadt-Anzeiger.

Industrial action threat

Ford's plans triggered a union threat of Europe-wide disruption.

"If negotiations between the works council and management in coming weeks do not ensure the future of workers, we will join the process. We will not hold back from measures that could seriously impact the company not just in Germany but Europe-wide," IG Metall said.

Ford of Europe produces, sells and services Ford brand vehicles in 50 markets, employing around 45,000 people at its own facilities and consolidated joint ventures, according to its website.

The latest cuts come three years after Ford's last big jobs cull.

In 2019 Ford announced that it was axing 12,000 jobs in Europe, about 20 percent of the overall workforce, and reducing its manufacturing footprint in the region to 18 facilities from 24. It ended production at three plants in Russia, closed an engine factory in Bridgend, Wales, and shuttered a transmission plant near Bordeaux, France.

Ford also closed its UK headquarters in Warley, Essex, and consolidated its British operations in Dunton, where it has a technical center.

Ford has been shrinking its passenger car lineup in Europe by axing models such as the Mondeo midsize car and minivans including the S-Max. The company is concentrating on sales of light commercial vehicles such as the Transit van, where it is a market leader.

The automaker's passenger car market share last year was 4.4 percent with sales of just over 510,000 units, according to industry association ACEA.

Reuters and Bloomberg contributed to this report

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