Ford to cut thousands of jobs as industry frets over weak EV sales

Ford has announced plans to cut 4,000 jobs across Europe – including 800 in the UK – as the car industry frets over weak electric vehicle (EV) sales that could see firms fined more missing government targets.

Nissan warned that the so-called mandates covering the sale of non-zero-emission cars risked “undermining the business case for manufacturing cars in the UK and the viability of thousands of jobs”.

It spoke up hours after Ford revealed cuts as part of plans to bolster its competitiveness in Europe amid the stuttering drive to the EV future.

The job losses would take place over the next three years, it said, with the bulk of them seen in Germany, where 2,900 roles were under threat.

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Most of those affected across Europe would be in administrative and support functions and product development, it added, with some manufacturing jobs hit too.

Ford was clear that its UK power unit plants at Dagenham and Halewood would not be affected.

It was aiming to achieve all the job losses through voluntary means by the end of 2027.

The announcement was made as EV sales across Europe face strong competition from China, a continued squeeze on household incomes and concerns among buyers around electric car ownership.

Ford said the restructuring aimed to create a “more cost-competitive structure and ensure the long-term sustainability” of the business amid “lower-than-expected demand” for its electric products.

Ford said it was seeking a greater partnership with governments and others over the difficulties being encountered in the transformation.

Manufacturers face stiff targets to halt sales of petrol and diesel-powered vehicles under efforts to combat climate change.

Bosses meet UK ministers on Wednesday to discuss the gradual toughening of targets for EV sales in the UK.

Firms face fines if electric cars fail to make up a percentage of their overall sales – a figure that stands at 22% for 2024.

Collectively, that target is widely expected to be missed by around 3.5 percentage points this year and companies argue that sceptical consumers and businesses need state incentives to make the change.

Worries include the cost of the vehicles themselves despite widespread discounting to help driver interest, vehicle ranges and significant holes in the public charging network.

The UK car industry lobby group the SMMT, which has highlighted a £2bn investment in price drops this year, warned last month that its members could not sustain their efforts to help drive EV sales indefinitely.

While the rule for 2024 requires manufacturers to ensure that at least 22% of new cars sold are zero-emission, the percentage target rises year by year to 2030 when only some hybrid variants will get around the Labour government’s ban on diesel and petrol-powered models.

The carmakers face a fine of £15,000 for each non-zero-emission vehicle sold that exceeds the annual percentage target.

SMMT boss Mike Hawes said following the meeting: “Today’s discussion with ministers was an important opportunity to restate the UK automotive industry’s commitment to both economic growth and net zero.

“However, the industry also made clear its concerns about the pace of the EV transition and the negative effect this is having on the health of the overall market and the attractiveness of the UK as a manufacturing location.

“A strong market and manufacturing base that sustains jobs and drives growth requires workable regulation backed by support for consumers – fiscal incentives and confidence that the charging network will be there when it is needed.

“We will now work urgently with the government to identify any adjustments necessary to help the industry and government meet their targets, instilling confidence in the consumer and other stakeholders, all of whom are part of this transition.”

But Nissan, which has its UK operations in Sunderland, went further and called for the EV mandates covering 20224 and 2025 to be replaced with a monitoring period.

Guillaume Cartier, its chairperson for the Africa, Middle East, India, Europe and Oceania (AMIEO) region, said: “The Mandate risks undermining the business case for manufacturing cars in the UK, and the viability of thousands of jobs and billions of pounds in investment.

“We now need to see urgent action from the government by the end of the year to avoid a potentially irreversible impact on the UK automotive sector.”

A UK government spokesperson said of Ford’s announcement and the industry’s challenges: “We know this will be a concerning time for workers at Ford UK and their families. While this is a Europe-wide decision taken for commercial reasons, we have asked the company to urgently share its full plans so we can help mitigate the impact in the UK.

“We have a longstanding partnership with Ford and will continue to work closely with them on their manufacturing future in the UK.

“We will also continue to support industry and consumers to make the switch, with over £300m announced in the budget to drive uptake of electric vehicles and £2bn to support the transition of domestic manufacturing.”