A new report Thursday discloses that Ford Motor may sack as many as 8,000 employees in order to devote more resources to the development of electric vehicles.
In a report by Bloomberg, it said the layoffs will affect the recently founded Ford Blue segment, which produces engines for gas-powered vehicles, as well as other paid, operational employees throughout the company.
In March, Ford CEO Jim Farley introduced the Ford+ plan, a radical reorganization of the company that includes the formation of the Ford Blue business and the Model E division, which handles electric vehicles.
As part of the strategy, Farley increased investment on electric cars to $50 billion, citing "our core automotive business" in an interview with Bloomberg Television.
Some employees are likely to lose their jobs this summer, and the layoffs may occur in stages, sources have. Based on estimates, they are anticipated to target the Ford sector in the United States, where 31,000 paid personnel are working.
Ford declined to comment on the anticipated layoffs, but reaffirmed its commitment to modernizing electric vehicles, the direction in which many automakers believe the future of the automobile industry will lie.
Chief Communications Officer Mark Truby stated in a statement to FOX Business that Ford would not comment on rumors.
Ford lost $3.1 billion in the first quarter of 2022, however a large portion of this was due to a significant decrease in the value of its interest in electric vehicle company Rivian. The operating profit decreased from $3.9 billion in the first quarter of 2021 to $2.3 billion.
As a result of the release of the electric F-150 Lightning pickup, Ford's EV sales increased 77 percent compared to a year before.
Farley has stated that reducing employees is essential for increasing earnings, particularly in the Ford Blue division, which is not operating as efficiently as it could be.
The additional financial supply can subsidize the expansion of electric vehicles. Sources said some of Ford's EV models have lost money as a result of rising commodity and warranty expenses.
EVs are seen as a significant step towards the decarbonization of the economy. Despite being environmentally benign, the switch to EVs has inevitably resulted in employment losses, particularly among auto-service professionals and other blue-collar positions.
Ford has been striving to improve other aspects of EV transportation as it prepares to launch a number of more EV models across its brands.
This includes substantial investments in battery technology, such as solid-state and lithium iron phosphate cells, and Ford Intelligent Backup Power, which helps keep the lights on in your home.
