American automaker Ford is set to lay off approximately 3,500 workers in Germany as it ceases production of the Focus, a once-popular vehicle that faced challenges in gaining traction with its electric version, by 2025.
The decision comes as Ford prepares to conclude Focus production at its Saarlouis plant next year, the sole model manufactured at that location, in a strategic move to transition exclusively to selling Battery Electric Vehicle (BEV) cars in Europe, according to reports from Automotive News Europe.
Speculation about the future of the Saarlouis plant arose two years ago when Ford opted to build its next-generation EVs in Spain rather than retrain workers at Saarlouis. Negotiations between Ford and IG Metall, the influential German union, have been ongoing to determine the fate of the affected workers.
The Saarlouis plant, which currently employs around 4,500 individuals, will offer retraining options for 1,000 workers after 2025. IG Metall has ensured a soft landing for the affected employees, with no forced layoffs until 2032 and the provision of attractive severance packages for those who choose to leave early.
Joerg Koehlinger, district manager of IG Metall Mitte, emphasized the union's efforts to secure the best possible outcome for workers, despite the challenges. Last October, Ford explored potential investment opportunities for the plant, but discussions with a potential investor reportedly fell through.
The decision to discontinue Focus production marks the end of an era for Ford, which began producing the Focus Electric at the Saarlouis plant in 2013. However, weak sales prompted Ford to halt European sales in 2017 and U.S. sales in 2018.
Meanwhile, Volkswagen announced its own job cuts in Germany in a cost-cutting measure aimed at reducing expenses by $11 billion. The Zwickau site, dedicated exclusively to electric car production, will see job reductions due to declining production demands, with the first wave of 500 temporary job cuts expected next year. Additionally, Volkswagen's software subsidiary Cariad will see 2,000 of its 6,500 employees lose their jobs over the next two years.