Ford CEO Jim Farley doesn't deny leaked report of plan to slash 8,000 salaried jobs
Ford CEO Jim Farley emailed employees a video message just after 6 a.m. Thursday acknowledging rumors of massive job cuts at the Dearborn automaker, and not denying those rumors, the Detroit Free Press has learned.
Farley urged employees to stay focused, saying he knew that reports about 8,000 job cuts in North America created high anxiety. He then said in the video that the company must reduce structural costs to be competitive, according to sources close to the situation who were not authorized to talk to the media.
The company confirmed to the Free Press that the video was sent to employees and the general narrative was accurate. Farley regularly issues videos and notes to the global team, spokesman Ian Thibodeau said.
This latest CEO message focused on where the company is headed, what it needs to do to get there and then addressed the news reports of job cuts, said two people who viewed the video message.
Farley said transformation of the company, and execution of the Ford+ plan to move more aggressively into production of all-electric vehicles, require substantive changes, the sources said.
The company confirmed the accuracy of the employee descriptions of the video.
The Free Press was unable to obtain a copy of the audio or video.
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Bloomberg, based on unnamed sources, reported Wednesday that Ford planned to slash 8,000 salaried jobs to help pay for its transition to electric vehicles.
The leak came prior to Ford's announcement Thursday on progress involving supply chain and batteries. During a news conference call, auto analyst John Murphy of Bank of America Merrill Lynch asked about the job cut rumors during this time of dynamic transition.
"It seems like you need more people to manage this, maybe not less," he said.
Lisa Drake, vice president of EV industrialization, responded, "Believe it or not, to move fast in this space, smaller is better. A smaller team can move faster than a larger team ... The Model e team is a little bit smaller than you might think. That allows the agility and the speed that we needed."
She said she has been at Ford 28 years, and this new Ford team moves fast because "bureaucracy" has been cut. She said decisions have been made with four to five key decision-makers in days, not months.
Drake announced the arrival of Annie Liu, an ex-Tesla and ex-Microsoft engineer with expertise in supply chain and battery management, during the call.
Warning about competition
Ford had declined to comment on "speculation" about its business on Wednesday
Before the Farley video was sent, spokesman T.R. Reid told the Free Press, "We’re ... modernizing our organization across all of the automotive business units and the entire company. We’ve laid out clear targets for our cost structure so that we’re lean and fully competitive with the best in the industry."
In October, Farley spoke to employees during an internal meeting and struck a serious tone while discussing the automaker's most formidable competition, which includes Tesla and Volkswagen.
He outlined what Ford must change to not just compete but aggressively strengthen the finances of the company and improve market value.
Farley was scheduled to be honored as the 2022 industry leader at the Automotive Hall of Fame dinner in Detroit later Thursday.
He is being recognized for demonstrating "outstanding leadership" in transforming Ford and the auto industry, according to the Hall of Fame news release.
"Ford has been restructuring its automotive business to give its teams greater clarity and focus, investing in manufacturing scale and capability, and delivering high-demand products and services to its customers," said Sarah Cook, president of the Automotive Hall of Fame.
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Farley said in the news release of the honor, which was put out in May, "As Ford accelerates its transition to an electric, connected future, I draw inspiration from the men and women who changed our industry for the better. As a grandchild of a Ford factory worker, I feel a deep sense of duty to our team around the world to protect Ford for future generations."
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Contact Phoebe Wall Howard at 313-618-1034 or phoward@freepress.com. Follow her on Twitter @phoebesaid. Read more on Ford and sign up for our autos newsletter.