Ford looks to shed hundreds of managers in Europe

AP News
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Posted: Feb 03, 2016 9:36 AM
Ford looks to shed hundreds of managers in Europe

FRANKFURT, Germany (AP) — Ford Motor Co. is looking to cut hundreds of managerial jobs in Europe and phase out less profitable models as it seeks to improve slender profit margins there.

The company said in a statement Wednesday that it was offering a "voluntary separation program" aimed at cutting administrative expenses and to save an additional $200 million annually.

The job cutbacks will hit Ford's roughly 10,000 managers, mostly in Germany and Britain. The company says the numbers depend on how many people accept separation offers, but that several hundred are expected to.

Ford said it will also introduce new vehicles to Europe this year such as the Edge SUV and the Focus RS, a higher performance version of the familiar compact. Small SUVs are selling well in Europe, while Ford is hoping that performance models — cars with more powerful engines and racy styling — will bring higher prices and polish the brand name.

Ford's European unit, based in Cologne, Germany, returned to profit in 2015, making $259 million pre-tax.

The company said it is making the changes to raise profit margins from the bare 0.8 percent achieved last year. It wants to achieve operating returns of 6 percent to 8 percent over the longer term.

The news comes a week after Ford said it was pulling out of Japan and Indonesia due to tough market conditions.