Ford Motor bring to light Monday that it is laying off about 7,000 managers and other salaried employees, about 10% of its white-collar workforce across the earth, as part of a restructuring plan designed to save the No. 2 automaker $600 million annually.
The cuts, some of which were formerly announced by the company, will be completed by August, Ford CEO Jim Hackett said in an email to employees Monday. Most of the reductions are abroad with roughly 2,300 of the job cuts coming from the United States. A company spokesman said 1,500 of the 2,300 U.S. job drawings were voluntary buyouts from last year.
This round of layoffs won’t impact Ford’s hourly mill workers. The company had roughly 199,000 employees across the world at the end of last year, about 3,000 less than the prior year, according to a securities filing.
Hackett said approximately 20% of upper-level manager jobs will also be dropped as the company moves to reduce bureaucracy.
The job cuts include voluntary buyouts and involuntary layoffs. About 900 of the 7,000 job carve hurts are expected to happen this week, 500 of which will be in the U.S. The remaining 300 U.S. layoffs will be complete by the end of August. The Michigan-based automaker put its restructuring in North America is almost complete and that it will continue its organizational redesign in Europe, China, South America and other intercontinental markets until the end of August.
“To succeed in our competitive industry, and position Ford to win in a fast-changing future, we must reduce officialism, empower managers, speed decision making, focus on the most valuable work, and cut costs,” Hackett said in the accurately.
The company had previously announced it planned to cut its European workforce, saying in January that it planned to eliminate thousands of appointments in Europe as it faced pressure to restructure its European operations. A company spokesman said Monday that there is overlay between the job cuts announced Monday and the various restructuring announcements the company has made in the past, though he would not detail how many job cuts overlapped.
Read Hackett’s letter to Ford employees here:
— CNBC’s Phil Lebeau and Reuters furnished to this report.
Correction: This article was updated to reflect that Ford is cutting about 10% of its white-collar wage-earners, not 10% of its total global workforce.