What’s Going On Here?Ford announced on Tuesday that it’s breaking up with 3,800 workers across Europe and the UK as it transitions to fully electric vehicles (EVs). What Does This Mean?Talk about timing: the US carmaker chose Valentine’s Day, of all days, to announce a so-called “voluntary” separation program for 2,300 German and 1,300 UK workers, with another 200 elsewhere also on the chopping block. This move will cut close to 10% of Ford’s employees across Europe, and comes as the carmaking giant accelerates toward a fully electric future. For now, Ford thinks EVs are simpler than old-fashioned gas guzzlers, and reckons they take less manpower to assemble. That’s all well and good for the auto colossus, but it’s cold comfort for the spurned workers. Why Should I Care?Zooming out: Europe’s stalling.
Ford announced 3,000 US layoffs back in August – but a quick napkin calculation shows that hit a far smaller percentage of the region’s 90,000-strong workforce than these European cuts do. Cynics might argue that’s because the US’s Inflation Reduction Act gives carmakers all kinds of generous handouts, making it easier to keep Americans on the books. But watch this space: Ford’s move will hit Germany’s vital auto industry where it hurts, which could get European lawmakers scribbling their own version of America’s policy before long.
The bigger picture: Electric dreams.
Ford’s accelerating its electric efforts so fast that it expects its entire car lineup to be gasoline-free by 2035. And it's not the only one with ambitions like that: most major carmakers have similar plans, and some governments are even aiming to ban gas-fueled car sales by the mid-2030s. But EVs don’t come cheap, and someone’s got to foot the cost of the transition. So sure, America's act helps, and EV production will get cheaper over time – but it’s likely that drivers and carmakers will ultimately have to swallow some of the cost. | 