Ford jobs cuts signal ‘an incremental death’ to its future in Germany: Is the end near?

With plans to drastically downsize its workforce, Ford’s future in Germany looks bleak. According to Germany’s largest trade union, Ford’s new job cuts “would mean an incremental death” to its future in Cologne.

Ford’s job cuts spark backlash in Germany

On November 20, Ford announced plans to cut another 4,000 jobs in Europe by the end of 2027. Most of them will be in Germany, about 2,900 of the eliminated positions.

The move comes after Ford incurred “significant losses” in recent years amid a “highly disruptive” influx of new competition, mainly electric models. Ford blames slower-than-expected demand for its EVs and a weakening economic situation for the downsizing.

According to the German newspaper Automobilwoche, Ford’s job cuts are now being discussed among economic committee members in the state parliament of North Rhine-Westphalia.

SPD parliamentary group leader Jochen Ott said, “The job cuts announced on November 20 are a breach of the agreement reached in February 2023.” Ott added that the lack of transparency and late information provided to the works council are a “blatant breach of trust and a slap in the face.”

Germany’s largest trade union, IG Metall, even chimed in, claiming the plans “pose a massive threat to the continued existence” of Ford’s remaining German sites.

Ford is still the largest employer in Cologne, but it will slash about one in four of its current 12,000 jobs by the end of 2027. By then, the American automaker will have halved its workforce in just ten years.

Two electric models, the Explorer and Capri EVs, are currently built in Cologne, but lack of demand is forcing Ford to slow production. Ford began building Capri EV models just last month after the electric Explorer in June.

Electrek’s Take

Ford is struggling to keep up in Europe as new competition enters the market. With China becoming flooded with low-cost EVs, domestic automakers are looking overseas for growth, and Europe is one of the biggest targets.

BYD, MG, NIO, and others are launching advanced new EV models aimed at European buyers. After squeezing legacy automakers like Ford, VW, and Toyota out of their home market, Chinese EV leaders are now looking for a bigger share of the global market.

As its record sales run continues, BYD topped Nissan and Honda for the first time in global deliveries this year. Now, it’s closing in on Ford.

According to a recent Bloomberg report, BYD is quickly closing in on Ford in global deliveries and could top the American automaker sooner than expected.

CEO Jim Farley acknowledged the threat of Chinese automakers, saying, “As the CEO of a company that had trouble competing with the Japanese and the South Koreans, we have to fix this problem.”

Ford is shifting plans to focus on smaller, more profitable EVs with a new low-cost platform. However, the first model, a midsize electric truck, won’t hit the market until 2027. By then, it could be too little, too late.