Ford Motor said Wednesday it is offering voluntary buyouts to white-collar employees in the U.S. as it continues to pivot toward new technologies including all-electric vehicles.
The automaker hopes to trim at least 1,400 salaried workers through the buyouts, a Ford spokesman told CNBC. It has been shrinking its workforce as part of an $11 billion restructuring plan, letting go about 7,000 salaried workers, including 800 in the U.S., last year.
Ford will offer the buyouts to certain salaried employees who are eligible for retirement as of Dec. 31. Employees have until Oct. 23 to accept the buyout and those who don’t could be laid off.
“The program is part of our underway and ongoing process to increase Ford’s global fitness and effectiveness, which includes reprioritizing products and services and staffing the company accordingly, so we’re more streamlined and successful,” spokesman T.R. Reid said.
The company had a worldwide workforce of 190,000 people at the end of 2019, including about 36,000 salaried employees in the U.S.
The restructuring plan announced by CEO Jim Hackett two years ago includes factory closures and model eliminations, reflecting the company’s shift to electric and autonomous vehicles.
Chief Operating Officer Jim Farley, who will succeed Hackett as CEO in October, “is expected to only accelerate the transition from classic, internal combustion technology to battery power, as well as pushing into connected and autonomous vehicle technology,” TheDetroitBureau.com said.
According to AutoTrends Consulting analyst Joe Philippi, Ford will need to keep trimming its workforce, with a focus on designers and engineers working on conventional gas and diesel products.
Most of Ford’s white-collar employees have been working remotely due to the coronavirus pandemic. Its U.S. factories resumed production in mid-May after a nearly two-month closure that resulted in a $1.9 billion second-quarter operating loss.
Farley has said that fixing and accelerating Ford’s North American operations to achieve 10% profit margins remains another priority. “The restructuring plan laid out by Hackett is barely halfway through and there may be other big moves to come,” TheDetroitBureau.com said.
In trading Wednesday, Ford shares rose 1.6% to $6.94.