Ford tries to avoid the $1billion loss in Europe applying a buyout program, which includes cutting several hundred jobs on the continent.
Ford has lost $404 million in Europe in the second quarter and the third-quarter results, which are expected in October, won’t look pretty either. The company presented its employees the voluntary program earlier this year, which will be divided in three programs implemented in the UK, Germany and the rest of Europe. Ford of Europe, which accounts for one-quarter of the automaker’s global revenue, announced it will cut several hundred jobs, the exact number being offered after the voluntary buyouts play out.
“The reductions will be achieved through a combination of voluntary Ford salaried staff separations, and reductions in expenditure on agency workers and purchased services,” Ford Motor Company said in a statement.
Currently Ford has about 66,000 employees in Europe, most of them in Germany. Ford announced such a possible move in July, when sales decreased 19% and CEO Allan Mulally said that Europe’s troubles go beyond the economic crisis and advised all automakers to seriously consider the overcapacity issue in the region.
“This is a structural issue, not a cyclical issue. It’s not going to come back fast and we’re not going to be saved by volume,” Mulally said.