Ford Motor Co. CEO Jim Hackett announced that five hundred white collar workers were being laid off this month beginning on Tuesday and would be gone by the end of the week. The layoffs are the first round scheduled for the U.S. automaker that's expected to increase to 800 U.S. employees by June, and up to 7,000 workers worldwide by the end of August.
In a letter sent to employees Monday morning, Hackett announced that the layoffs would be cutting management ranks by 20 percent which would result in saving the company $600 million every year.
“We also made significant progress in eliminating bureaucracy, speeding up decision making and driving empowerment as part of this redesign,” according to Hackett.
Ford will try to make the separations as painless as possible, Hackett said in his letter to employees.
"Ford is a family company and saying goodbye to colleagues is difficult and emotional," Hackett wrote. "We have moved away from past practices in some regions where team members who were separated had to leave immediately with their belongings, instead giving people the choice to stay for a few days to wrap up and say goodbye."
Hackett thanked his employees who were being let go for their service, writing that the company had a "range of resources and services in place to support employees in managing this transition."
The move is part of an $11 billion investment that is meant to help restructure the Ford Motor Co. As part of the massive restructuring, several plants in the United States were recently closed and the company made new investments in electric and self-driving cars.
Ford isn't the only automaker that's had to lay off workers so far this year. General Motors announced in February that it too would be laying off 4,000 white collar workers, and in March the company announced it would shutter the plant in Lordstown, Ohio, eliminating 1,700 hourly positions.
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