Workers at Ford plants in Germany's Cologne to strike for first time

Workers at US carmaker Ford's plants in the western German city of Cologne are set to go on strike for the first time ever to protest against planned job cuts, the IG Metall union said on Monday, in the latest upheaval to face Germany's ailing auto sector.

Employees at the two plants, which were founded in 1930, are due to stop work from Wednesday morning, with the strike set to last until the end of the night shift on Thursday morning, according to the union.

Management is looking to cut 2,900 jobs by 2027 at the Cologne site, which also includes Ford's European headquarters and employs a total of 11,500 people - already far fewer than the 20,000 who worked there in 2018.

Unions accuse Ford bosses of proceeding without a concept and thus jeopardizing the continued existence of Ford's Germany subsidiary.

IG Metall, one of Germany's most powerful unions that represents workers across different manufacturing sectors, is advocating for a collective agreement that provides for high severance payments and financial security for the workforce.

Negotiations between the two sides have stalled, leading IG Metall to ballot workers for the first time last week. An overwhelming 93.5% of union members voted in favour of the unprecedented industrial action to increase pressure on management.

"It is time for the employer to make a move and find an overall solution for the workforce in Cologne," said Benjamin Gruschka, head of the works council at Ford Germany.

However, the options of the leadership at Ford's German subsidiary are limited as the company is ultimately dependent on its US parent company.

Strike to seriously affect production

Of the 11,500 Ford employees in Cologne, around 4,500 work in production and 3,500 in product development, according to the union.

Around 1,700 people are employed in a spare parts centre while there are also administrative and other departments.

The impact of the strikes is likely to be serious, as the vast majority of employees are union members and there is great resentment among the workforce about the current situation.

Ford's European offshoot has been making losses for a long time, with production of the Ford Fiesta, a small car manufactured in Cologne that was initially widely successful, discontinued in 2023.

Ford currently produces two electric cars in Cologne, sales of which have fallen well short of expectations, despite investments amounting to almost €2 billion.

According to official figures, Ford models only accounted for 3.5% of newly registered cars in Germany last year, compared to 5.0% in 2022.

Although the Ford plants are to receive a financial boost of several €100 million from the US parent company for further investments over a period of four years, industry experts believe this is far too little.

'Situation is bad, prospects are even worse'

According to industry expert Ferdinand Dudenhöffer, the future for Ford in Europe is looking dire.

"The situation is bad and the prospects are even worse," said Dudenhöffer, director of the Bochum-based Centre Automotive Research.

"Ford is too small in the passenger car sector to be able to operate profitably in Europe - that is the case now and will very likely remain so in the future," he said.

Dudenhöffer gave a pessimistic outlook for Ford's operations in Europe, saying the number of units sold was too low while labour costs were too high.

Ford has been losing market share in Germany and Europe for a long time, the expert noted.

"Ford is shrinking and shrinking - it is now so small in Europe that it makes little sense to continue operating in the current constellation," he said.

According to Dudenhöffer, there are two solutions to Ford's European troubles.

One option would be for the US parent company to sell its European car business to "get rid of the problem," he said. Car production could remain in Cologne, but the development department and administrative areas would move to the buyer, according to the expert.

Another option would be to set up a joint venture with another car manufacturer and thereby achieve higher volumes and lower costs, Dudenhöffer said.

That way, Ford Europe "might finally become competitive," he said, suggesting French carmaker Renault as one possible partner.