Ford Motor (F:US) confirmed media reports that it is conducting layoffs. The restructuring is mostly affecting engineering jobs in the U.S. and Canada.
Several media outlets, including Wall Street Journal, reported that the car company is preparing to cut salaried workers in a bid to drive costs down and increase its capital allocation to electric vehicles (EVs).
“As we have said, part of the ongoing management of our business includes aligning our global staffing to meet future business plans, as well as staying cost competitive as our industry evolves,” a Ford spokesman told WSJ.
The job cuts will affect all three of Ford’s business segments: Blue, Model E, and Pro. The announcement comes after Ford said in its latest earnings report that it expects to register charges between $1.5 billion to $2 billion “primarily attributable to employee separations and supplier settlements” in 2023.
Ford spent just $608 million on similar actions in 2022, which highlights the costs associated with the restructuring at companies as large as Ford. The company already cut about 10,000 jobs last year.
“Delivering our Ford+ plan for growth and value creation includes increasing quality, lowering costs, investing in our priorities, and adjusting staffing to match the capabilities we need,” the company said in an emailed statement, according to CNBC.
Ford is expected to report at the end of July when it is likely to provide an update on the exact costs associated with layoffs.
Ford shares have been trading on the up in recent weeks after the company announced a deal to use Tesla’s Supercharging network.
Senator Tommy Tuberville has been trading Ford on a continuous basis in recent months. In May, he disclosed several transactions involving the purchase of Ford shares, including the $100,000 - $250,000 worth of purchase on April 27 when the stock closed at $11.61.
Ford shares closed at $14.11 on Monday, June 26.