Under pressure Ford is moving to further cut costs in North America – this time targeting white-collar workers. The company is planning to reduce white-collar staff costs by 15% over the next two months through job cuts, attrition and other actions.
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The news follows warnings last month that further cuts were coming in response to lowered production.
The cuts follow another bad month – May – for vehicle sales in the recession-hit US market. The market is tanking in the face of high gasoline prices, a rocking housing sector and generally fragile consumer confidence.
“We told employees today we are going to cut salaried workforce-related expenses by 15 percent and complete the actions by August 1,” Ford spokeswoman Marcey Evans told Reuters.
“This does include reductions in headcount and contract jobs, attrition and consolidation of positions,” she said.
Reuters noted that Ford has about 24,300 salaried workers in North America. It warned employees in May that cuts in production would force a reduction in its salaried and hourly workforce, the report said.
Salaried workers who are dismissed will be offered standard company severance packages.
Although Ford has showed encouraging signs of a beginning of a turnaround in its overall financial results, CEO Alan Mulally has recently said that the company may not be profitable in 2009, necessitating further actions on the American cost base.
