Ford Motors has decided to cut 3,000 jobs from its global workforce. Moreover, the automaker giant has come up with this decision in a bid to lower their cost as part of restructuring efforts. Furthermore, the move of cutting jobs will affect both salaried and contract workers.

Cost cutting and restructuring

Ford Motors is working on transition from making combustion vehicles to battery operated vehicles. Therefore, they have come up with a restructuring plan which will help in reducing their costs. Subsequently, the saved cost will help make the long transition from internal combustion vehicles to those powered by batteries. In addition, the cost saving actions are result of fears of a potential recession. Inflation in United States is hovering around a forty year high.

No impact on union factory workers

The company’s spokesperson confirmed that they started notifying the workers on Monday. Furthermore, they job cuts will apply on 2,000 salaried positions and 1,000 contract jobs in the U.S., Canada and India. Farley and Ford Chair Bill Ford communicated this in a message to employees. Currently, Ford is employing 31,000 full-time salaried workers. Hence, the job cuts comprise of nearly 6% of the 31,000 existing full-time workers. However, Ford’s 56,000 union factory workers are not affected during this restructuring.

“Building this future requires changing and reshaping virtually all aspects of the way we have operated for more than a century. It requires focus, clarity and speed. And, as we have discussed in recent months, it means redeploying resources and addressing our cost structure, which is uncompetitive versus traditional and new competitors.” Ford said in their message to the employees.

Shift towards electric vehicles

In March, Ford announced a restructuring that split its electric vehicles and internal combustion engine (ICE) vehicles into two units. Ford Model e is dedicated to EVs, software and connected vehicle technology. Whereas, Ford Blue will continue on manufacturing internal combustion vehicles to drive profitability. Moreover, governments across the globe are pushing to eliminate combustion vehicles to mitigate the impact of climate change.

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