The American automaker Ford has been facing significant challenges in the face of slowing demand for electric vehicles and increased competition from Chinese rivals. On Wednesday, the company announced that it would eliminate 4,000 jobs in Europe as part of a broader reorganization plan to strengthen its business in the region. The job cuts will primarily affect plants in Germany and Britain, and Ford will also reduce the production of an electric version of its Explorer sport utility vehicle, resulting in shorter working hours at a plant in Cologne, Germany, in the first quarter of 2025.

Commitment to a Thriving Business in Europe

Ford's European vice president for transformation and partnerships, Dave Johnston, emphasized the company's commitment to building a thriving business in Europe. He stated that it is critical to take difficult but decisive action to ensure Ford's future competitiveness in the region. This move is seen as a necessary step to adapt to the changing market dynamics and position the company for long-term success.

Ford's pullback comes at a time when the auto industry is navigating the bumpy transition to electric vehicles. The growth rate of electric vehicle sales has slowed this year in some European countries, and Ford has struggled to sell as many battery-powered models as it had hoped in the United States. In August, the company announced that it would reduce the pace of investments in such vehicles.

Other automakers, such as Volkswagen and Mercedes-Benz, have also shifted their strategies after reporting fewer sales of battery-powered vehicles than expected. Sales of electric cars in the 27 member nations of the European Union fell 5.8 percent in the first nine months of the year. Additionally, automakers face intense competition from Chinese companies like BYD and Geely, which have made a strong push into Europe with relatively affordable electric and hybrid vehicles.

Industry Collaboration for a Smooth Transformation

In its statement on Wednesday, Ford called on industry executives, policymakers, union officials, and others in Europe to work together to help smooth out the industry's rocky transformation. This collaborative approach is seen as crucial in addressing the challenges faced by the auto industry and finding solutions that benefit all stakeholders.

Last month, the European Union voted to increase tariffs on imported electric vehicles made in China to as much as 45 percent. Some Chinese automakers have responded by teaming up with European automakers to produce electric vehicles in Europe or by building their own factories there. China has also reacted to the increased tariffs by imposing temporary penalties on brandy from Europe and warning of possible tariffs on other European goods. The growing trade tensions between China and the European Union have led some companies to rethink their business strategies.

For example, the brandy maker Hennessy, part of the LVMH conglomerate, is considering bottling its products in China to avoid the higher costs. This decision has led to a strike at a factory in southwest France, highlighting the impact of trade tensions on businesses.