Ford Is Spending Billions to Save Itself in Europe
The automaker wants to reduce costs and stay relevant.
Ford Motor Company announced Monday it's investing billions of dollars to transform its European operations. The automaker said it wants to reduce costs and increase its competitiveness on the continent.
The €4.4 billion ($4.8 billion at today's exchange rate) will go, in part, to reduce the debut at Ford-Werke's facilities. The German subsidiary will also use the funds for a "multi-year" plan to support its ongoing restructuring efforts.
"In order to be successful in Europe in the long term, we must continue to simplify our structures, reduce costs, and increase efficiency," said FoMoCo Vice Chairman John Lawler.
The new investment and business plan replaces Ford's declaration of patronage in Germany, which is where a US company guarantees a German subsidiary's liabilities. According to IG Metall, Germany's largest union, the replacement declaration could allow Ford-Werke to go bankrupt in the next few years.
"The aim is to put pressure on the works council in the most horrible way possible to agree to the planned operation changes," the union said in a translated press release. According to IG Metall, the automaker wants to cut 2,900 jobs at its Cologne facility. However, Ford can't do that until 2032.
Ford needs to do something to turn things around in Europe. The company saw its sales crater in 2024, selling 87,174 fewer cars than in 2023. It also saw its market share slip from 4.0 to 3.3 percent. The loss isn't surprising—Ford killed off the Mondeo, Fiesta, and Ka, with the Focus leaving the lineup this year.
That leaves the Mustang as Ford's only car; everything else is a crossover, an SUV, or a commercial vehicle. Ford also offers two EVs in Europe, but both are heavily related to the Volkswagen products they share a platform with. EV market share fell in Europe last year, which didn't do the company any favors.
Ford's Europe Woes:
Sources: Ford, IG Metall
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