Ford Motor Company is planning to lay off nearly 8,000 employees in the coming weeks to boost funds in the electric-vehicle market.
The layoffs are said to help wean Ford off ICE production and use those funds to further invest in EV development. The layoff plans may come in phases and are likely to begin this summer.
Chief Communications Officer Mark Truby said in a statement, “As part of this, we have laid out clear targets to lower our cost structure to ensure we are lean and fully competitive with the best in the industry.”
The job cuts will be made in its newly created Ford Blue unit, which is responsible for manufacturing internal combustion engine vehicles.
In addition, there will be layoffs in other salaried operations throughout the company. The majority of the cuts are expected to be in the U.S. where Ford employs about 31,000 salaried workers.
Although the plan is not yet finalized and could change.
Ford CEO Jim Farley has said he plans to slash $3 billion in costs by 2026 and that he wants to turn Ford Blue into “the profit and cash engine for the entire enterprise.”
In March, Farley restructured the automaker to create two businesses: the “Model e” unit to develop EVs and “Ford Blue” to focus on internal combustion engine vehicles such as the popular F-150 pickup, the Mustang and the Bronco SUV.
The changes led to Farley boosting spending on EVs to $50 billion and supported the plan to build 2 million battery-electric vehicles annually by 2026, after selling just 27,140 in the US last year.
Last month, Ford’s EV sales rose 76.6% from a year earlier as it rolled out the hot new electric F-150 Lightning pickup.
