Ford Layoffs 2023: What to Know About the Latest F Job Cuts

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Ford (NYSE:F) stock is in the red today as the automaker apparently prepares to launch another round of job cuts in the latest example of Ford layoffs. According to The Wall Street Journal, the Michigan-based car maker is planning to lay off mostly U.S. salaried employees in its gas-engine division “as well as its electric-vehicle and software division.” This move is a part of the company’s effort to streamline operations and cut costs.

What does this mean for F stock?

Well, nothing good. Today’s news comes as a sort of sequel to the company’s 3,800 person reduction in its European wing earlier this year and its 3,000 employee job cut last August. Indeed, according to early reports, the company is planning on letting a variety of corporate employees go this time around.

Interestingly, however, Ford has had little to say when asked about the impending job cuts.

“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 company spokesman told WSJ.

Today’s news shouldn’t come as a complete surprise. For one, Ford spends “about $7 billion to $8 billion more each year than rival car companies on its business.” This is mostly by way of supply-chain and warranty costs.

Accordingly, Ford has stated that it plans to cut at least $3 billion in yearly costs by the halfway point of the decade. It plans to do so largely by reducing warranty costs and simplifying its company structure.

“The strength of our products and revenue has masked this dysfunctionality for a long time. It’s not an excuse, but it’s our reality,” Ford CEO Jim Farley said back in February.

Ford Layoffs Push F Stock Lower

While news of today’s Ford layoffs has proved a slight bearish indicator for F stock, Ford has generally had a pretty good year so far. Indeed, Ford is up about 20% year-to-date (YTD). Shares have also soared more than 23% in just the past month.

Ford is one of many legacy automakers being forced to make a brisk transition to electric vehicles (EVs) in the face of structural shifts toward low-emissions transportation. Indeed, the company has committed to spending $50 billion through 2026 on its realignment toward EVs. Even internally, the firm has begun segregating its gas-engine business from its EV side.

That said, Farley believes the company’s EV business will likely lose as much as $3 billion in operating profit this year as the division gears up.

On the date of publication, Shrey Dua did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

With degrees in economics and journalism, Shrey Dua leverages his ample experience in media and reporting to contribute well-informed articles covering everything from financial regulation and the electric vehicle industry to the housing market and monetary policy. Shrey’s articles have featured in the likes of Morning Brew, Real Clear Markets, the Downline Podcast, and more.

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