FRANKFURT (Reuters) -Ford will inject up to 4.4 billion euros ($4.76 billion) into its struggling German operations as it tries to revive its European business, the U.S. carmaker said on Monday.
Its Ford-Werke German arm will continue strategic transformation initiatives, focusing on reducing costs and increasing competitiveness, Ford said after the Financial Times first reported the news.
“By recapitalising our German operations, we are supporting the transformation of our business in Europe and strengthening our ability to compete with a fresh product portfolio,” said John Lawler, vice chair of Ford Motor Company.
“To build a sustainable business in Europe, we also need to continue to simplify our governance, reduce costs and drive efficiencies.”
The new funding commitment includes a capital injection to address overborrowing at Ford-Werke and provide funding for a multi-year business plan.
Lawler also called on European policymakers to establish a clear agenda to promote electric vehicles and bring emissions targets in line with consumer demand.
Europe’s car industry has been forced into plant closures as stiff competition from China has dented demand. The sector is also bracing for U.S. tariffs.
Ford is cutting thousands of jobs in Europe, many of them in Germany, where domestic giant Volkswagen has also been struggling.
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(Reporting by Shivansh Tiwary in Bengaluru and Christoph Steitz in FrankfurtWriting by Rachel MoreEditing by Mrigank Dhaniwala, Miranda Murray and David Goodman)
