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Ford Motor Company has decided to construct its next-generation electric vehicles in Valencia. As part of the company’s expansion policy and drive towards the future, the US carmaker chose the location instead of a competing plant in Saarlouis, Germany.
Before an anticipated EU prohibition on the sale of new gasoline and diesel automobiles, the business intends to sell entirely electric cars in Europe by 2030. But as part of its shifting strategy, a spokeswoman told Reuters that there would be “substantial” job losses.
Electric vehicle production relies heavily on automated assembly lines and involves fewer workers. When an EU prohibition on the sale of new gasoline and diesel cars, scheduled to take effect in 2035, is implemented, plants that do not win manufacturing orders for electric vehicles, like the Saarlouis complex, which employs 4,600 people, face the prospect of closure. Ford Motor Company has warned there will still be workforce reductions even for the locations chosen to assemble electric vehicles, such as the Valencia plant, which employs 6,000 people.
The corporation has several other factories in Europe, including ones in Turkey, Romania, and Cologne, Germany, that have been chosen to make electric vehicles. Ford has committed to investing $2 billion in its Cologne factory, where starting in 2019, it will assemble electric vehicles with Volkswagen-licensed technology.
All Ford vehicles that utilize the company’s proprietary electric vehicle technology will be manufactured at the Valencia facility.
Ford Motor Company has historically struggled to turn a profit in Europe, a fiercely competitive auto market. As a result, it has reorganized its company in the area and leveraged the push toward electric vehicles as a springboard. Ford had more than 50,000 employees in Europe but has already laid off 12,000.
Stuart Rowley, chairman of Ford’s European division, said, “Bringing our all-new electric car architecture to Valencia will help us develop a viable business in Europe.”
The company’s chief executive for the world indicated that Ford’s switch to electric vehicles in Europe would necessitate difficult choices.
According to Jim Farley, president and CEO of Ford Motor Company, “The European car business is tremendously competitive, and to thrive and develop, we can never settle for less than amazingly fantastic products… [and] ultra-lean operations.”
According to the Society of Motor Manufacturers and Traders, sales of electric vehicles in the UK have increased significantly in recent years, with more battery-powered cars expected to be registered in 2021 than in the previous five years combined (SMMT).
Electric vehicle registrations increased by more than 75%, from 108,000 in 2020 to 191,000 in 2017. They made up one in every four vehicles sold in December, while Tesla’s electric Model 3 finished the year as the second-best-selling vehicle in the nation.