Ford Motor Co. is reportedly planning substantial job cuts in order to boost profits and raise its stock price. According to reports the nation's second-largest automaker earned $1.7 billion in the fourth-quarter quarter, the highest pre-tax profit in a decade, up 55% from a year earlier.
Ford declined to comment on any job cuts but said it remains focused on its core strategies to "drive profitable growth".
Ford Motor said Wednesday it would cut its salaried workforce in North America and Asia by almost 10% as it seeks to boost profitability amid a falling stock price.
What's more, the USA auto market, where Ford makes the bulk of its profit, appears to have peaked in 2016, meaning Ford must find other areas to bolster the bottom line.
The cuts are not expected to affect hourly workers at Ford's factories or operations in Europe and South America, which have already endured workforce reductions.
The voluntary incentives offers will go to about 9,600 of 30,000 USA salaried workers, the company said.
As Reuters further points out, Ford's strategic plans to reduce its workforce by 10 percent may not sit well with U.S. President Donald Trump, who wants to boost employment in the auto industry.More news: Jose Mourinho Looks To Europa League Final After Tottenham Hotspur Defeat
Ford is aiming to cut $3 billion in costs in 2017, a person close to the matter told AFP.
The "people efficiency actions" - first reported in The Wall Street Journal - are part of the company's plans to save US$3bn this year. Ford has roughly 30,000 salaried employees in the United States.
Back in January, following criticism and pressure from Trump, Ford pledged to scrap plans for a Mexican vehicle plant and added 700 jobs in MI instead.
Ford has been hiring steadily in the USA since the recession as vehicle sales roared back to reach record highs. Electric auto maker Tesla Inc., led by Elon Musk and based in Palo Alto, recently surpassed Ford in market value even though Tesla sells far fewer vehicles.
In a statement, Ford would not confirm it is slashing jobs.
It is unclear if those jobs will be affected by the cuts.
Ford Chief Executive Mark Fields is under pressure from shareholders and board directors to improve profits, particularly in North America, and reverse a almost three-year slid in the company's stock price that has eroded more than 30% of shareholder value.