Currently reading: Ford to axe less-profitable models in Europe and trim workforce
Ford announces overhaul of European business: unprofitable models will be cut; greater focus on crossovers and SUVs; several hundred jobs could go
Darren Moss
News
2 mins read
3 February 2016

Ford will reduce the size of its workforce and axe some less-profitable models in its range, as the company strives to increase its profitability in Europe.

As part of a major Ford of Europe overhaul announced today, the company said it would introduce a "voluntary separation" programme, which would allow workers to leave the company at their own behest. The move is expected to save $200 million (about £138m) annually, and is designed to give Ford “industry beating levels of efficiency”.

The Blue Oval also announced that it would be “eliminating less profitable models” from its product range. Among those models is the current Ka, which is due to end production this year. An all-new Ka is planned for 2019, and the model has already been spotted testing, but Autocar understands the new model will be significantly different to today's car, and will increase in size.

In the future, the Ford statement said it will put a greater emphasis on SUVs and crossovers, a strategy that was first announced last September. The Ford Ecosport, Edge and Kuga models will be joined by two new crossovers, which Autocar understands will be based on the Fiesta and Focus.

Ford said it wants to improve its European profits in 2016 and grow its operating margin. The company said its European strategy calls for a “more streamlined and profitable product line; more emotional and experimental brand communications; and a leaner cost structure to lower break-even and help offset growing regulatory costs.”

Announcing the plan today, Ford’s European boss Jim Farley said: “In the past three years, Ford of Europe has improved its business in all areas and moved from deep losses to a $259 million (about £178m) profit in 2015. This is a good first step.”

“We are absolutely committed to accelerating our transformation, taking the necessary actions to create a vibrant business that’s solidly profitable in both good times and down cycles. Our job is to make our vehicles as efficiently as possible, spending every dollar in a way that serves customers’ needs and desires, and creating a truly sustainable, customer-focused business.”

The company says it will launch seven new or refreshed vehicles in 2016, including the new Focus RS performance hatchback already driven by Autocar. It will also expand its hybrid and electric offerings in Europe. A new version of the Focus Electric is already known to be in development, and, in total, Ford will add 13 new electric vehicles to its range by 2020, as well as providing electrified versions of 40% of its model range.

Another area of growth will be all-wheel drive. The firm currently offers eight models with all-wheel drive and expects to sell around 140,000 AWD vehicles in Europe this year.

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Ford will also expand its current super-luxury ‘Vignale’ line-up, which currently consists of only one model, the Mondeo Vignale - to include five models by 2017.

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traveller1 4 February 2016

Ford Explorer

I do not understand why Ford are so slow at reacting to the market. They are always late with new models and generally behind the competition. Having driven Explorer, Edge and Escape in the US I can say they are all fine cars but I cannot understand why the popular Explorer is not available in the UK. Much better looking than the Edge. I recently looked at buying a Kuga but declined due to the all dark trim. I would like a choice Mr Ford.
jason_recliner 3 February 2016

Yay.

More four wheel drives. I'm excited.
Cé hé sin 3 February 2016

Head Count

Makes sense for Ford to apply the axe here and there. The idea behind the "One Ford" policy is to avoid duplicating the design process by making different but similarly sized models for different markets. The inevitable consequence is that they were left with excess design capacity and given that Europe generally loses money that's where the cuts are going to be. The same thing happened when Ford of Europe were formed and the centre of gravity moved from Dagenham to Cologne.