Europe is getting a double dose of bad news as Jaguar Land Rover is cutting jobs, while Ford of Europe has unveiled a new turnaround plan aimed at cutting costs.
Starting with the Blue Oval, Ford said it is working to implement a “comprehensive transformation strategy” which will see the company adjust its lineup to better meet consumer demand. While the company didn’t go on an American-style killing spree, Ford said it will focus on profitable and growing vehicle segments, while eliminating products in less profitable areas. This effectively means more crossovers and less MPVs.
As part of this effort, Ford reconfirmed it has begun discussions to end production of the C-Max and Grand C-Max at its plant in Saarlouis, Germany. Ford also announced plans to crease production at its transmission plant in Bordeaux, France this August.
Besides these changes, Ford of Europe will cut costs by reducing the complexity of its existing lineup in an effort to focus on the “most profitable vehicle configurations.” This means consumers can expect less choices in the future as options and trim levels will be streamlined.
Unsurprisingly, the focus on profitability also means jobs cuts. Ford didn’t mention numbers, but said it wants to eliminate “surplus labor across all functions” including both salaried and hourly employees. The company is aiming to do this through voluntary separations, as much as possible, but it’s likely a number of employees will lose their jobs involuntary.
As part of the restructuring, Ford of Europe will focus its business around three different pillars: commercial vehicles, passenger vehicles and imports such as the Mustang. On the commercial vehicle side, Ford noted it is exploring a potential alliance with Volkswagen.
When it comes to passenger vehicles, Ford said drivers can expect “sporty and progressive designs” as well as an electrified option (mild-hybrid, full-hybrid, plug-in hybrid or EV) on all future vehicles.
A lot of the action will take place on the import side as the Mustang-inspired electric crossover will arrive in Europe next year. Ford also said Europeans can expect a new SUV to be unveiled in April. There’s no word on what the mystery model is, but it could potentially be the baby Bronco.
Besides the aforementioned changes, Ford is undertaking a strategic review of its joint venture in Russia – Ford Sollers – and will consolidate its UK headquarters and Ford Credit Europe’s headquarters in South East Essex.
In a statement, Ford group vice president and president of EMEA region said “Working collectively with all stakeholders, our new strategy will enable us to deliver a more focused lineup of European-built passenger vehicles, while growing our import and commercial vehicle businesses – for a healthier and more profitable business.”
In related news, Jaguar Land Rover announced plans to cut up to 5,000 jobs in the United Kingdom. This is expected to include a mix of both blue and white collar employees.
The news comes hot on the heels of disappointing sales figures as the automaker revealed the company only sold 592,708 vehicles last year. Sales were down 4.6% compared to 2017 and this was largely due to a sluggish performance in China where sales dropped 21.6%. The company also said “weaker market conditions, primarily relating to diesel and Brexit, also weighed on sales” as the numbers dropped 1.5% in the UK and 7.8% in Europe.