Electric cars are being a real revolution, we know it, however it is not being as simple as many expected… Ford has been one of those for whom this revolution is getting stuck and they have been forced to cut more than 1,000 jobs at their Cologne (Germany) plant for next year 2026… Why? Because Europe is still very far from what the industry had foreseen and it is time to change strategy in this region…
“In Europe demand is still below industry forecasts…” -Ford
The cuts will be in the production segment, there is no demand, gentlemen, there is none, and that is a problem and Ford has had to make a decision. This implies that the factory will move to working on a single daily shift, which directly drags the loss of those jobs. A measure that makes clear that maybe they were being a bit more optimistic than they should have… And reality is not accompanying them at all.
Not just a German problem
What is happening in Cologne does not only happen in Germany, Ford had already been warning that the energy transition would be complicated, and in recent months it has made similar decisions in other parts of the world.
In South Africa, for example, they were already forced to make a cut of more than 470 jobs in two of their plants, and it was all because of the massive entry of Chinese and Indian vehicles.
And in 2024 the company had already cut 14% of its workforce in Europe, which is equivalent to more than 4,000 workers, where the greatest impact was for Germany and the United Kingdom. The need to reduce costs is due to the fact that the electric market is still very weak and there are not enough public incentives for the sale of these cars to finally take off…
Europe against Chinese manufacturers
The Old Continent has become a difficult ground for Ford and for other traditional manufacturers, not because they do not want electric cars, but because Chinese brands have landed strongly and with very cheap cars! Of course, that has changed the whole landscape for the rest of the manufacturers…
Add now inflation, the distrust of many buyers towards electric cars (ahem, and towards Ford….) and that many users are still waiting for more affordable prices, batteries with greater range and a more solid charging network before taking the step of changing their combustion vehicles.
Cuts also in North America
Europe and Africa have had to undergo adjustments, but in the United States and Canada they also had to assume cuts last May, almost 350 software jobs had to say goodbye to their positions. This represented 5% of their workforce in that division… All to improve the efficiency of the brand, but of course, the headlines are not especially good for the workers who were laid off..
Ford is warning and the other brands will also have to adapt their strategies to these markets that are a little more complicated than the American one. European governments insist on accelerating the transition to electric cars, but the pace of adoption is not accompanying and neither are the incentives!
In the meantime, brands have to cut, adjust costs and slow down projects to be able to survive this situation. The 1,000 layoffs in Cologne are a hard blow for the workers and for the city, but they are also a reminder that this transformation will be slower, more expensive and much more complex than many had predicted…