Thousands to lose jobs in Europe
Tension in the European automotive industry has risen with confirmation that Ford and Jaguar are set to roll out thousands of jobs cuts across the continent this year.
In a statement released Thursday, Ford confirmed there would be ‘significant impact across the region' as it potentially reduced up to 30 per cent of its 54,000 jobs in Europe.
"We are taking decisive action to transform the Ford business in Europe," said group vice president Europe, Middle East and Africa, Steven Armstrong in a statement.
“There’ll be significant impact across the region. This isn’t a one or two-year issue. We have had periods of profitability but not on the level it should be.”
Ford has not said how many would be affected by the cutbacks but confirmed it would pull out of the MPV segment, combine Ford UK and Ford Credit headquarters to one site and review its Russian operations.
Stanley Morgan analyst Adam Jonas added in a note that, "We believe Ford Europe could require as much as a 20 to 30 percent reduction of capacity and headcount.”
Ford is not the first American automaker to have trouble in the European market, with General Motors departing from the region in 2017 and Volkswagen announcing late-2018 that it had entered into a partnership to help Ford keep a foothold in Europe.
“We are building an alliance with Ford which will strengthen Ford’s position in Europe because we will share platforms,” said VW CEO Herbert Diess to reporters.
Jaguar Land Rover was not far behind Ford in announcing it will consolidate European operations in an effort to find an answer to falling sales, spurred on by slowing sales in China, a lack of interest in diesel engines and a move away from sedans to SUVs.
The British marque owned by Indian behemoth Tata Group said it would cut 4500 jobs, mostly in the UK and mainly from its blue-collar workforce, though Tata said it was "committed to the long-term growth and success of JLR".
An engineer for JLR at its Whitley plant near Coventry told the BBC that, "It's not clear what's going on," and, "A lot of people are wanting to stay here long term. It's very tense."
JLR currently has around 42,500 employees in England but it’s not just the workforce that’s worried about cutbacks, as suppliers have also voiced concern that it will have a knock-on effect to the greater supplier industry.
Jaguar Land Rover CEO Ralf Speth said in a statement: "We are taking decisive action to help deliver long-term growth, in the face of multiple geopolitical and regulatory disruptions as well as technology challenges facing the automotive industry".
Overcoming the slump in sales due to many Europeans dumping diesel and the tightening of emissions regulations, JLR is converting some of its plants to begin production of electric drivetrain systems in 2019.
Its first electric vehicle, the I-Pace SUV, had a rocky reception but recovered late-2018 with strong sales numbers.
Alex Rae is Drive’s Melbourne based reporter with over 10 years’ experience in the automotive industry as a photographer and journalist. Having studied both engineering and the arts, Alex understands what makes things tick while appreciating that sometimes it’s all about form over matter…