A leading auto industry analyst is calling on Ford CEO Jim Hackett to cut more jobs to meet the savings goals that Ford has outlined. Earlier this week, Ford announced that it was trimming 7,000 white collar jobs globally. Some workers in the U.S. prepared for the layoffs last week by taking their belongings home. Shedding 7,000 workers is a significant layoff, but Morgan Stanley analyst Adam Jonas says that isn’t enough.
Jonas says that for Ford to meet its profitability goals, it needs to shed more than three times the 7,000 worker number for a total of 23,000 salaried jobs. Jonas says that by shedding 23,000 salaried jobs, Ford could meet its near term goals. Ford has stated that the 7,000 salaried workers that it will let go globally will save it $600 million annually.
That savings works out to about $86,000 per worker. Jonas says that his calculations show that Ford needs to reduce salaried worker headcount by another 23,000 positions. Ford has been clear with this round of Ford job cuts that none of the 7,000 jobs would be for hourly workers or in the form of plant closures. Ford plants in the U.S. are said to be operating efficiently.
Jonas isn’t alone in stating that the 7,000 Ford job cuts it hs said it will make won’t allow the automaker to reach its goals. Analyst Jon Gabrielsen, an advisor to automakers and suppliers, has said that no one who analyzes the Ford situation thinks 7,000 jobs “remotely scratches” the surface of what will be required.
The automaker has been making significant Ford job cuts globally. It announced in March that it would be shedding 5,000 jobs in Germany. Ford has also moved to close its largest factory in Brazil and to close three factories in Russia as it works to revamp globally.