Ford Motor Co. is eliminating more salaried jobs, the company confirmed Wednesday.
Salaried workers in accounting, human resources and administrative support working at Ford World Headquarters in Dearborn are reportedly being let go, sources close to the situation confirmed to the Free Press. In addition, the information technology team in China has reportedly seen reductions.
"We're not going to provide any numbers," Ford spokesman Said Deep said Wednesday in response to questions about the specific areas cut. "We will provide details once the process is complete in the second quarter."
He added, "We are undergoing a smart redesign process that allows us to create a more dynamic, agile and empowered workforce. At the same time, we're becoming more fit as a business."
Deep declined to say when from April through June the company would announce the total number of jobs slashed. Asked whether cuts were, in fact, happening on Wednesday, he declined to provide details.
"I can tell you that this whole redesign is going to reduce bureaucracy and empower our leaders to focus on the most value-added work and ensure we have the right cost structure around the world," he said.
"Yes, the work has resulted in some separations of salaried employees and the reassignment of others. We understand this is a challenging time for our team, but these steps are necessary. We expect the process to be completed in the second quarter and will make announcements at the appropriate time."
Pressed for details - more than 10 jobs? More than 100 jobs? - Deep said, "All I can tell you is there are some separations this work has resulted in. This process began earlier. So it starts at the top, cascades through the organization and has been happening over weeks and months. Leaders at the various levels of the company are shaping the organization, focusing on the most critical work and, in some instances, shifting how work is done."
While Deep declined to discuss timing, sources within the company said cuts are happening this week.
White-collar workers have said for months that the mood at Ford headquarters in Dearborn is palpably anxious. They describe "paralyzing" tension waiting for job cuts and strategic decisions as the company's $11-billion restructuring slowly unfolds.
Ford CEO Jim Hackett acknowledged employee anxiety in an interview with the Free Press in February.
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"I think it's totally fair," he said. "My mind wants to say, 'Is that because of the anxiety of the restructuring?' They're holding onto the ambiguity, saying, 'I don't know my status.' That is really unfair to our people to have to go through that. There's a trade, see. You end up with a lot better process from end to end if you involve the people actually in the design of what we're doing. When CEOs edict that we're just taking out X thousands of people, like you're mowing the lawn, it makes everyone feel like inanimate objects. Bill (Ford) and I care a lot more than that."
In addition to job cuts confirmed Wednesday, Ford employees who declined to be identified for fear of retribution say they are bracing for cuts at the Product Development Center, as well as cuts of engineers working in buildings off Oakwood at Rotunda in Dearborn.
Ford takes great pride in being the largest U.S. employer in the auto industry, with about 85,000 employees overall in 2018 and 56,000 hourly workers represented by the UAW.
"Ford's operations need restructuring. We do not see restructuring at Ford as a 'nice to have' ... but as a crucial step to set the global business on a more balanced footing," wrote Morgan Stanley's Adam Jonas on Aug. 20, 2018.
He predicted a 12 percent cut in Ford staff worldwide.
Jonas emphasized that Ford's $11-billion cost projection is "materially larger" than the previous $8.5 billion that analysts expected, and the lack of an investor update at the time "contributed to investor anxiety."
"Investors need to weigh the risk of betting on management delivering on an unknown plan that may take three to five years to play out ... opening up to a range of potentially adverse economic and credit scenarios that could impede execution," Jonas wrote.
Ford employs about 202,000 people worldwide. Analysts estimate separation costs, also called buyouts, to be roughly $120,000 per employee for Ford.
The wisdom of slowly cutting jobs over a period of months has been questioned, both internally and externally.
John McElroy, a longtime industry observer who hosts "Autoline After Hours," said Wednesday in response to the latest Ford news, "When it comes to laying off a bunch of people, the best thing to do is pull the Band-Aid off right away and not tug at it slowly - which only increases the pain for everybody at the organization."
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