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Ford Oz cutting jobs to be ‘operationally fit’

Targeted: Job cuts announced in Detroit this week will hit an unspecified number of Ford Australia employees, particularly those working at its Richmond head office in Melbourne.

Number of affected workers to be confirmed, but Ford Australia looking to future

23 Jun 2017

FORD Australia president and CEO Graeme Whickman has explained that the incoming reduction in its workforce is part of a transformation process to make the brand “operationally fit” and sustainable for the future.

Speaking to GoAuto at the launch of the new Transit van, Mr Whickman could not confirm the exact number of affected workers, nor the timeframe and from which departments specifically, but said that “we’ll look in Australia and other parts of Asia Pacific around our operational fitness and our leanness and make some decisions there”.

“Part of being operationally fit is being appropriately lean,” he said.

“Announcements both in North America and Asia Pacific (said) 10 per cent (reduction in jobs) was a number put out there and there was speculation as to what does that mean in total, and I’m not here to tell you the exact numbers because it’s a work in progress.

“So, there is no number that we’re chasing in particular in any given country, it’s about being operationally fit and we’ll look at if we actually are or not and then go from there.

“We’re going through a process right now, examining our footprint, making sure we’re comfortable with our size.”

However, Mr Whickman did reiterate that jobs at Ford’s Asia-Pacific Product Development Centre (APPDC) in Victoria are safe as the facility is expected to ramp up development and testing for a number of new global products including the upcoming Bronco SUV and refreshed Ranger pick-up.

“It won’t be anything to do with our product development function in Australia, that’s been growing,” he said. “We’ve just announced some investments you know it was only six months ago a half a billion dollars investment was announced and we opened the APPDC.

“So it’s not about that, it will be other parts of our business we’re be looking at.”

Mr Whickman said the challenges the Blue Oval is now facing are not dissimilar to the cessation of local production in October last year, which signalled the death of the Falcon and Territory, as well as the loss of some 600 manufacturing jobs.

“We also have gone through transformation in Australia in the last two or three years already, so you’d argue that we’ve been a little bit ahead of what’s been happening globally because we needed the right size and to make sure we were building a business that is sustainable in Australia going forward anyway,” he said.

“So to me it’s actually more of the same mindset, the same analysis to make sure we’ve got something that is sustainable going forward.”

Ford Motor Company announced job cuts to its North American and Asia Pacific workforce last month with voluntary packages, and has since also seen the role of president and CEO switch to former Ford Smart Mobility LLC chairman Jim Hackett from a retiring Mark Fields.

Mr Whickman said the reduction in workforce is not due to drastic cost cutting or from pressure above, but instead is about transforming the company and being future ready.

“We’ve got a very sound financial footing and Mark Fields, as he elected to retire from the company, left us in a very strong financial state, so it’s not about that,” he said. “It’s about taking control of our destiny and continuing to invent ourselves and parts of the world we aren’t playing in.

“I think it’s important that we change at the right pace so there’s a lot of energy around that, making sure that we disrupt our own business before others do so – that’s kind of important – and being operationally fit, as I’ve already mentioned, and also our new CEO is very keen to ensure we have the right culture as well.

“So I don’t see that as pressure at all, I see that as a normal evolution in some parts of our business.

“I think any modern business now is having to embrace some of these challenges.”

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