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Published on October 16th, 2018 | by Steve Hanley


Ford Layoffs & Trump Tariffs: The Real Story

October 16th, 2018 by  

Ford Motor Company could be the poster child for the disruption the electric car revolution is causing in the auto industry. One of the world’s largest and most enduring manufacturers of vehicles is in big financial trouble and struggling to chart a course forward. It is fair to say that if Ford doesn’t figure things out — and pretty damn soon — it could be one of the legacy auto makers that falls by the wayside, joining the ranks of Hudson, AMC, and Studebaker as one of America’s former car companies.

Ford F-150

Ford sales are off 11.2%. Ominously, sales of the Ford F-150 — the vehicle that is almost as much a symbol of the United States as the flag, the bald eagle, and the national anthem — are down 9% for the month of September. Since January 1, Ford stock has taken a 29% haircut. Last month, CEO Jim Hackett announced a massive $24.5 billion global restructuring plan, one that would see the company shed about 12% of its employees, according to The Drive.

MSM Vs. Ford

Now here’s where things get interesting. On October 10, Fortune ran a story with this headline: “Ford Prepares for Mass Layoffs After Losing $1 Billion to Trump’s Trade Tariffs, Report Says.” And there you have it. #Pravduh about a car company other than Tesla. According to the Michigan Watchdog, both parts of the headline are accurate but they don’t belong together in the same sentence. While the mainstream press has been in a frenzy to report that thousands of manufacturing jobs will be lost due to Trump’s aluminum and steel tariffs, the truth is that the job cuts will affect only white collar workers around the world.

“The reports you have read about our organization redesign work being related to external forces such as tariffs are incorrect,” Ford spokesperson Karen Hampton told Watchdog.org. “This is a global effort and not specific to the U.S.,” she added. “We began this effort recently as part of our CEO’s work to make us a faster, more nimble, more innovative company.”

She added that she wished the press had reached out to Ford for clarification first before publishing their stories. Tesla supporters can surely relate to Ford’s distress. The change is intended “to support the company’s strategic objectives, create a more dynamic and empowering work environment, and become more fit as a business,” the company says.

What About Those Tariffs?

That’s not to say the Trump tariffs have had no effect on Ford. They have. “The metals tariffs took about $1 billion in profit from us — and the irony is we source most of that in the U.S. today anyways,” Jim Hackett says. So while they are not the direct cause of the Ford restructuring plan, they are definitely inflicting some pain on the manufacturing sector, which isn’t helping things any. It’s hard to see how sucking a billion dollars out of a company’s profits will help it add new jobs in manufacturing.


The takeaway from this story is that watching the changes in the auto industry these days is like observing a glacier. One minute it’s intact. The next minute, a huge chunk breaks off and is floating out to sea. Jaguar is thinking about going to an all-electric lineup by 2025. Just today comes news that Citroen may do the same by 2020! (More on that story coming soon.)

And still the big car companies are crying in their beer about how nobody wants to buy electric cars. Hello? Is anybody home up there in the C suites at Ford, GM, Chrysler, VW, BMW, Mercedes, or Toyota? Do you not see the news reports about Tesla outselling all the major car companies in many market segments? In fact, Tesla sold more cars in the third quarter than Cadillac has sold in the US in all of 2018!

You can close your eyes to what is happening right outside your window for only so long before the Nokia moment arrives and blows your familiar business model right into oblivion. Caveat, pharetrator. 

Hat tip: Dan Allard 

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About the Author

Steve writes about the interface between technology and sustainability from his homes in Florida and Connecticut or anywhere else the Singularity may lead him. You can follow him on Twitter but not on any social media platforms run by evil overlords like Facebook.

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