Ford cutting 7,000 white-collar jobs despite healthy profits

Ford is cutting about 7,000 white-collar jobs, which would make up 10% of its glo൩bal workforce.

The company has said it was undertaking a maj♏or restructuring and on Monday said that it will have trimmed thousands of jobs by August.

The company said that the𓂃 plan will save about $600 million per year by eliminating bureaucracy and increasing the number of workers reporting to each manager.

In the US about 2,300 jobs will be cut through buyouts and layoffs. About 1,500 alrea🌼dy have happened. About 500 workers will be let go this week.

In a memo to employees Monday, CEO Jim Hackett said the fourth wave of the restructuring will start on Tuesday,ꦆ with🍨 the majority of cuts being finished by May 24.

“To succeed in our competitive industry, and position Ford to win in💙 a fast-charging future, we must reduce bureaucracy, empower managers, speed ꦺdecision making and focus on the most valuable work, and cost cuts,” Hackett wrote.

In the US about 1,500 white-collar employees left ⛎the company voluntarily siཧnce the restructuring began last year, some taking buyouts. About 300 have been laid off already, with another 500 layoffs starting this week.

Most o🥀f Ford’s white-colla꧃r workers are in and around the company’s Dearborn, Michigan, headquarters.

It’s the second set of layoffs for De♛troit-area automakers, even though the companies are making healthy profits. Sales in the US, where the automakers get most of their re🍬venue, have fallen slightly but still are strong.

In November, General Motors announced it would shed up to 14,000 workers as it cut expenses to prepare for a shift to electric and autonomous vehicles. The layoffs included closure of five factories in the US and Canada and cuts of another 8,000 white-collar workers worldwide. About 5,000 blue-collar positions were cut, but most of the laid-off factory workers in the US will be placed at other plants mainly thꦰat build trucks and SUVs.

Both companies have said the cuts are needed to prepare for the future, because the companiꦏes face h൲uge capital expenditures to update their current vehicles and develop them for the future.

The cuts brought withering criticism of GM from President Donald Trump and Congres💖s, especially the closing of a small-car factory in Lordstown, Ohio. Trump campaigned on bringing factory jobs back to the industrial Midwest. GM has since announced a possible deal to sell the Lordstown plant to a startup electric vehicle maker, but it hasn’t been finalized.

Hackett said in the memo that Ford is departing from past practices and letting laid-off employees stay a few days to 🦄wrap up their jobs and say goodbye to colleagues. In the past, laid-off workers would have had to pack up and leave immediately.

“Ford is a family compa💮ny and saying goodbye to colleagues is difficult and emotional,” Hackett wrote.

Shares of Ford Motor Co. slipped early Monday.