Carmaker Ford has announced plans for a major shake-up of its operations in the UK and mainland Europe.
It is expected to lead to thousands of job losses across Europe, including the UK, although cuts at its UK factories are not thought to be imminent. But Ford Europe boss Steven Armstrong said should the UK leave the EU without a negotiated deal, a further review of UK operations would take place, bbc.co.uk informs.
Ford is now going to talk to unions about measures to reduce costs.
This includes focusing on more profitable models and exiting less profitable markets, to concentrate more in future on electric and hybrid technology.
The firm will also expand its commercial vehicle business, which will be one of three new divisions being created, along with passenger vehicles and imported vehicles.
Ford hopes the changes will enable it to achieve a 6% operating margin in Europe.
Ford says there will be a “reduction of surplus labour” across all its business functions. It has not released any figures, as discussions with unions are continuing, but that it could be in “thousands”.
Profits at Ford of Europe fell 82% last year, in part due to the fall in the value of the pound as a result of uncertainty over Brexit.
Ford of Europe has 54,000 employees, with 13,000 in the UK. As well as the UK engine plants, it has other operations in Germany, France, Turkey, Spain, Russia, Romania, and Belgium.
As part of the shake-up the firm says it will stop manufacturing automatic transmissions in Bordeaux, France, in August, and will review its operations in Russia,
What is to happen with the Craiova factory?
In this context, details are expected from the plant in Craiova, Dolj County. The announcement on Thursday could turn upside down the plans regarding the expansion here. In September 2018, as Romania Journal reported, Ford started hiring staff for its factory in Craiova, being available 1,700 job vacancies. Most jobs are for basic and skilled operators.
According to Europafm.ro, the employees in Craiova will not be affected. The employment campaign envisages the launching of a new model, involving an additional investment of EUR 200 million in the plant.
Currently, the Ford factory in Craiova has about 4,000 employees.
The Craiova plant has a production capacity of 300,000 units per year, but Ford never reached even half of the maximum capacity.