Ford's cost-cutting plans 'could lead to 1000 job losses at Bridgend'

  • Ford's cost-cutting plans 'could lead to 1000 job losses at Bridgend'

Ford's cost-cutting plans 'could lead to 1000 job losses at Bridgend'

"Working collectively with all stakeholders, our new strategy will enable us to deliver a more focused line up of European-built passenger vehicles, while growing our import and commercial vehicle businesses - for a healthier and more profitable business", Mr Armstrong said.

Jaguar Land Rover and Ford are preparing to implement cost cutting plans which will result in thousands of job losses for the UK's automotive sector.

Ford is now in talks with Volkswagen Group over a potential alliance, which could boost its strategic cost-cutting and boost its efforts to deliver an alternatively-fulled vehicle (AFV) drivetrain for each of its auto models.

Ford's announcement on layoffs came as Britain's biggest carmaker Jaguar Land Rover (JLR) is also set to announce "substantial" job cuts in the thousands, a source told Reuters. "Nothing is off the table", Mr Armstrong said.

He didn't specify the number of possible job cuts and said that plant closures are an option to streamline operations.

The car-maker plans to consolidate its United Kingdom headquarters and Ford Credit Europe's headquarters at its Dunton technical centre in South East Essex.

Ford was among US carmakers that fell short of expectations when the industry presented sales for previous year, adding to concern that a slowdown may occur in 2019.

Jaguar logo
A Jaguar logo is seen on a car in central London Britain on Jan. 10 2019

Jo Stevens, the Labour MP for Cardiff Central, said Ford's decision was "awful news for Bridgend and the whole of south Wales". A Ford spokesman said the carmaker now assumes that any Brexit deal would keep tariff-free trade between Britain and Europe. Analysts have speculated Ford's generous dividend may be at risk. Audi, VW's biggest profit center, likewise noted more struggles ahead, reporting a 3.5 percent drop in sales past year. The review also includes "rescaling the footprint of the business" with Ford reviewing the efficiency of its plants, Armstrong said. In America, the company is already dropping several sedans.

Ford Europe, which employs 53,000 people, has struggled to turn a profit, reporting a €245 million ($282 million) loss before interest and taxes in the third quarter, equivalent to a negative 3.3% EBIT margin.

Production at the Ford Aquitaine Industries plant in Bordeaux, France, which manufactures small automatic transmissions, will end in August 2019.

It is also undertaking a review of its joint venture in Russian Federation. This year, performance will already be "significantly better" than 2018, Armstrong said.

Ford's $14 billion global cost-saving plans includes exiting the minivan segment, stopping manufacturing of automatic transmissions in Bordeaux in August, reconsidering its operations in Russian Federation, and combining the headquarters of Ford U.K. and Ford Credit to a site in Dunton, Essex.

"We are continuing to invest in the business, especially in electrified cars", said Armstrong. "We will still have a comprehensive lineup of cars in future with primarily SUVs and crossovers".