Ford to cut salaried jobs in $11 billion restructuring plan

Bloomberg

Ford Motor Co. has told its 70,000 salaried employees that they will face unspecified job cuts as part of the automaker’s $11 billion restructuring, a bid to reverse its fading fortunes and cope with competitive pressures more nimbly.
Morgan Stanley has speculated that Ford may pare more than 20,000 jobs from its global workforce of 202,000, but the automaker wouldn’t quantify how large it expected the salaried reduction to be or it if would involve involuntary separations. Ford also couldn’t estimate the financial impact or say whether it will take any charges for the program.
“Yesterday, we told our employees that we were in the early stages of an organizational redesign of the global salaried workforce,” Karen Hampton, a company spokeswoman, said in an interview. The goal is “that gradually you’re getting a wider, flatter organization that is really designed for speed. Inevitably, we expect that to result in some reductions, but at this point there’s not a target.”
In July, the second-largest US automaker cut its profit forecast for 2018 after second-quarter earnings fell by more than half. Chief Executive Officer Jim Hackett announced the restructuring at that time but declined to give details beyond the $11 billion cost. He also canceled a September investor meeting in Dearborn, Michigan, where company is headquartered.

FALLING BEHIND
Ford, beset with an aging model lineup, fell behind Fiat Chrysler Automobiles NV — as well as General Motors Co. and Toyota Motor Corp. — in US sales last month for the first time in a decade. Investors are stampeding out of its stock, which has fallen 27 percent this year, and its credit rating is now one step above junk.
Still, the automaker has remained upbeat. “I don’t think it’s even close to a crisis — we’re making good profitability,” Executive Chairman Bill Ford told reporters last week at a centennial celebration of the company’s Rouge manufacturing complex. “Do we still have work to do? Yes, we do. But we are investing heavily in the product. We’re investing heavily in the future. And there’s nothing that we want to do that we can’t do.”