Ford Motor Company F plans to slash workforce in Germany and the U.K., per Reuters. It is expected to cut more than 5,000 jobs in Germany while the workforce reduction count in the U.K. is not known yet. The job cuts in these countries are in sync with the company’s strategy to revive business in Europe.
In a bid to recover from declining profits in the European business, this automaker announced restructuring operations at the beginning of the year. As part of a turnaround effort, Ford announced that it will lay off workforce, close manufacturing hubs and cease loss-making vehicles in Europe. Further, it plans to exit from the multi-van segment and focus on developing hot-selling crossovers and sports utility vehicles. Additionally, it is reviewing Russia operations, which led to two plant closures in March.
Apart from sluggish vehicle sales, mounting costs are hurting Ford’s profitability in the region. With an aim to reduce expenses, it is partnering with peer companies. In January, the company announced collaboration with Volkswagen AG. Per the partnership, the companies will build commercial vans and pickups, and explore electric and autonomous technological developments.
Ford Motor Company Price and Consensus
Ford Motor Company Price and Consensus | Ford Motor Company Quote
Softening demand in China and a sluggish European market hampered Ford’s earnings in 2018. In fourth-quarter 2018, the company generated automotive revenues of $38.7 billion and adjusted earnings of 39 cents. Both the figures missed their respective Zacks Consensus Estimate.
For 2019, the automaker expects North America, China and Europe operations to drive EBIT. Further, product launches, fitness initiatives and turnaround efforts are expected to drive profits in these regions.
Over the past three months, shares of Ford have outperformed the industry it belongs to. Shares of the company have gained 3% compared with its industry’s increase of 0.2% during that period.
Zacks Rank & Stocks to Consider
Ford currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader auto sector are Ferrari N.V. RACE, Oshkosh Corporation OSK and PACCAR Inc. PCAR. Ferrari currently sports a Zacks Rank #1 (Strong Buy) while Oshkosh and PACCAR carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Ferrari has an expected long-term growth rate of 18.5%. Over the past three months, shares of the company have gained 29.2%.
Oshkosh has an expected long-term growth rate of 11.3%. Shares of the company have gained 23% over the past three months.
PACCAR has an expected long-term growth rate of 10.8%. Shares of the company have gained 24.6% over the past three months.
Zacks' Top 10 Stocks for 2019
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