While Ford is cutting many thousands of jobs in Europe and especially in Germany, the car manufacturer is creating numerous jobs in its home country. 2,500 alone in a new battery factory.
The European workforce of the car manufacturer Ford received bad news on Tuesday (February 14, 2023): They are facing massive job cuts. By 2025, 2,300 jobs are to be lost at the Cologne and Aachen locations alone. A further 1,500 jobs are to be lost in Great Britain and other European countries; Around 3,800 jobs across Europe will be affected by the cuts.
Ford currently employs around 19,000 people in Germany. The job cuts will primarily take place in the development department (1,700) and administration (600). It seems logical that Cologne and Aachen are becoming less important as development locations, after all, the brand is using Volkswagen's modular electric drive system (MEB) including batteries for its next European electric car generation. The next generation should be based on its own platform , which will be developed in the USA. Nevertheless, 3,400 employees in Europe will continue to take care of vehicle development and design.
No further redundancies
The measure was preceded by weeks of negotiations with the IG Metall union. Ford has agreed with her on socially acceptable job cuts with mutually voluntary severance pay and early retirement programs. In addition, the car manufacturer and its employee representatives have reached an agreement that excludes further redundancies at the Cologne and Aachen sites until the end of 2032.
The main reason for the job cuts is the increasingly worrying economic situation of the parent company. Last year he made a loss of more than two billion dollars (currently the equivalent of almost 1.9 billion euros), around 400 million (374 million euros) of it in Europe. Ford is responding with a tough austerity program. Added to this is the shift towards electromobility. Ford is aiming for "a smaller, more focused and increasingly electric product portfolio" in Europe, says Martin Sander, the car group's head of Germany.
Unchanged electric car plans for Europe
Despite the job cuts, Ford wants to stick to its electric car plans for Europe. A sporty MEB-based electric crossover is coming later this year, which according to the first Erlkönig and teaser images should be a VW ID.4 equivalent with a more angular design. In 2024, an as yet unnamed "medium-size crossover" will follow, which is said to be an electric counterpart to the Ford Puma. There are also electric versions of the Transit and Tourneo commercial vehicle range.
The announcement of the job cuts almost a year after Ford announced that it would invest two billion dollars in its Cologne location. The aforementioned electric crossover based on MEB is supposed to roll off the assembly line there. The plant in Saarlouis, where Ford will produce the Focus until 2025, is on the brink. Here the car manufacturer seems to be aiming for a sale, although several takeover candidates are said to have already expressed an interest. In addition to Cologne, the backbone of the future European production network is to be formed by the locations in Valencia, Spain, in Halewood (Great Britain), in Turkey and in Craiova (Romania).
New battery plant in the USA
By the way, Ford is not planning any job cuts in the USA. On the contrary: in its home state of Michigan, the automaker is building a new battery plant for $3.5 billion (about €3.26 billion). The gigafactory, called "Blue-Oval Battery Park," in the city of Marshall, is scheduled to start operations in 2026 and create 2,500 jobs. But that's not all: Ford intends to create a total of 18,000 new jobs in the USA.
The new battery factory, for which Ford is aiming for a total capacity of 35 gigawatt hours, is a direct consequence of the US government's "Inflation Reduction Act". According to this, electric cars only receive a government subsidy when they are bought there if they are produced in North America and the batteries and their raw materials also come from there or from countries that have a free trade agreement with the USA. "This step brings us closer to battery independence," says the chairman of the supervisory board, Bill Ford will use the know-how of the battery specialist CATL. These energy storage systems are said to be cheaper and more durable than the nickel-cobalt-manganese (NCM) counterparts that have been widely used up to now, and tolerate more frequent charging processes. In addition, the raw materials required for this should be more readily available, the proportion of critical materials such as nickel and cobalt should be reduced and there should also be advantages in loading speed. Ford plans to equip the electric crossover Mustang Mach-E with LFP batteries soon. The E-Pick-up F-150 Lightning should be ready in 2024.
Globally, Ford will invest 50 billion dollars (46.6 billion dollars) in its transformation into an electric car manufacturer in the coming years. In 2023, the group wants to produce 600,000 electric cars over the course of the year for the first time. By the end of 2026, the annual BEV output is expected to increase to two million vehicles.
At the latest when it became known that Ford's future electric cars will first be based on the Volkswagen MEB and then on a platform designed in the USA, fears about their own jobs should have spread in the German development departments. These have come true: Ford is cutting around 1,700 jobs in this area. And also 600 in administration and around 1,500 outside Germany. Around 4,500 more jobs will soon be added to these 3,800 jobs that have been axed; namely when the end of the Saarlouis plant is completed.
Such news should sound all the more bitter against the background that Ford announced almost simultaneously that it would build new plants and create jobs in the USA.