Ford plans to cut workforce by 10% in North America, Asia
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Ford Motor Co. plans to cut 10% of its salaried workforce in Asia and North America. The company will announce the measure later this week as response to shareholders frustrated by the stock price, which has lost more than one-third of its value under the tenure of current CEO Mark Fields.
According to The Wall Street Journal, the first media outlet to break the news, the reduction of workforce will take place all over the world. However, anonymous sources told Reuters cutbacks will happen only in North America and Asia.
The company plans to offer early retirement incentives by October 1, but does not plan cuts to its hourly workforce or its production. Analysts estimate Ford has about 30,000 salaried workers in the United States, 8,140 full-time employees in Canada and 11,300 in Mexico.
The automaker has been under pressure both from its board of directors and from shareholders in recent days to show that its strategic plan is working as U.S. industry sales begin to decline for the first time in seven years.
Ford's profits sank 35% during the first quarter to US$ 1.6 billion as higher costs for warranties, recalls and materials eroded profits.