Ford Motor Co. announced on Tuesday that it will cut up to 1,000 jobs at its electric vehicle plant in Cologne, Germany. The company said the move comes as sales of battery-powered cars are not meeting expectations.
The carmaker explained that it will try to reduce the impact on employees by using voluntary departures and buyout packages, according to a report by AP.
Production at the Cologne plant, which builds the electric Explorer SUV, will also be scaled back. Starting January, the plant will move from two daily shifts to just one.
Demand lower than forecast
Ford admitted that demand for electric vehicles in Europe is “significantly below industry forecasts.” Despite heavy investment, sales of EVs have not grown as quickly as many carmakers expected.
“In Europe, the demand for electric cars is significantly below industry forecasts,” the company statement reads.
$2 billion investment at risk
This round of layoffs follows Ford’s restructuring plan announced in November 2024. At that time, the company said it would cut about 4,000 jobs across Europe and the UK, with 2,900 of those in Germany. Workers had gone on strike earlier this year before a deal was reached with IG Metall union, guaranteeing jobs for more than 10,000 workers at the Cologne plant until 2032, news agency AFP reported.
Ford has already invested about $2 billion (2.3 billion euros) to modernise the Cologne plant for electric vehicle production. The upgrades were made in anticipation of stronger demand for low-emission vehicles, but sales momentum has been weaker than expected.
Why are EV sales slowing
High upfront prices and a lack of charging stations have made it harder for EVs to gain popularity in Europe. Another factor is the withdrawal of purchase subsidies in Germany, which has slowed growth further.
Electric vehicles accounted for 15.6% of the European market through July this year, up from 12.5% a year earlier. However, the growth has been slower than expected. Ford sold 260,000 vehicles of all types in the first seven months of the year, a small increase of 0.7%. Its market share remained steady at 3.3%, according to the European Automobile Manufacturers’ Association.