Ford to cut costs in Europe After recently reporting that it anticipates a $1.5 billion loss in Europe this year, Ford Motor Company will take steps to attain more profits in the market. The brand has struggled in European countries, and by shifting its focus to new products, and implementing strategies to reduce manufacturing costs it hopes to succeed on the continent.

"Using the same One Ford plan that led to strong profitability in North America, we will address the crisis in Europe with a laser focus on new products, a stronger brand and increased cost efficiency," said Alan Mulally, Ford's president and CEO. "We recognize the impact of our actions will have on many employees and their families in Europe, and we will work together with all stakeholders during this necessary transformation of our business."

Introducing new products
Ford has plans to bring 15 new models to the European market in the next five years, and the company will put a focus on the SUV, a vehicle that's increasingly popular overseas. This means Europeans will finally be introduced to the famous Ford Mustang for the first time. The corporation also has plans to completely redesign and expand its commercial vehicle lineup.

Aside from new models, the company will also boost its focus on desirable technology in its products. New cars will see a boost in smart technological advances, such as parking assistance, SYNC in-car connectivity and EcoBoost engines.

Slashing costs
Because of the massive losses Ford has dealt with in Europe, it needs to find ways to achieve significant cost savings in order to stay competitive and profitable. The company announced that new vehicle sales in Western Europe have reached a near 20-year low, and demand has dropped more than 20 percent since 2007. This has resulted in the need for it to introduce several initiatives to reduce spending and better manage production.

To keep from over producing vehicles dealers can't sell due to low consumer demand, Ford will cut down on its manufacturing and reduce the amount of inventory at dealerships. By putting more of a focus on low stocks, the company can save its plants from manufacturing more cars than it can sell.

To increase cost-effectiveness on the continent, Ford has announced plans to close and move several manufacturing facilities. The company also plans to cut about 500 jobs in the region, and revealed that salary cuts will hit about 13 percent of its European workers. These cuts are necessary for the company as it transforms its business on the continent and hopes to slash unnecessary expenses.
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