Ford’s job cuts to hit North America and Asia most

Ford plans to cut about 10% of its global salaried workforce while retaining the technology talent it’s recruited to develop driverless and electric cars, according to a person familiar with the strategy.

Jobs are being cut as Ford’s directors pressure chief executive officer Mark Fields to boost profit and a lagging stock price. The reductions are expected to target salaried employees mostly in North America and Asia, said the source. Some are also expected in Europe, where Ford already has retrenched.

Mr Fields is working to cut costs by about $3bn (€2.74bn) this year. With Ford’s stock down about 37% since he became CEO in 2014, Mr Fields is caught between pleasing a board pressuring him to boost fading profits while placating US president Donald Trump, who is pushing automakers to add US jobs. Ford also is pouring billions into electric, self-driving cars and ride-sharing as its struggles more than General Motors with a slowing US market.

“This has to be done surgically rather than randomly or otherwise you lose the talent you need the most,” said Maryann Keller, an industry consultant. “This will be offered to the traditional automotive staff.”

Ford shares have declined 10% this year, compared with a 3.6% drop for GM and 23% gain by Fiat Chrysler. Reducing costs and becoming “as lean and efficient as possible” is a priority, Ford said in a statement.

“We have not announced any new people efficiency actions, nor do we comment on speculation.”

Retrenching in the US risks reopening Ford to criticism from Mr Trump. Mr Fields and executive chairman Bill Ford have curried favour with the president this year, giving him advance notice of hiring and investment at American plants and cancelling a small-car factory in Mexico. Mr Trump has pointed to carmakers’ plans and claimed they are restoring American manufacturing because of him.

Ford temporarily laid off 130 workers at an Ohio truck plant earlier this month due to slower demand. Automakers have widespread shutdowns planned for the summer in the US, conflicting with Mr Trump’s upbeat portrayal of the industry.

Bloomberg