DETROIT - Ford's Volvo Cars division plans to lay off up to 1500 workers, or 5 per cent of its global workforce this year, as part of an effort to cut costs by more than US$130 million ($188.98 million), a company spokesman says.
Olle Axelsson said Volvo, bought by Ford
in 1999, had been hit hard by a weak US dollar and strong competition in the US market.
US sales at Volvo, whose solidly built cars are marketed to upper-middle class buyers, are down about 5 per cent so far this year.
"We need to balance that negative effect," Axelsson said.
The company would cut between 1000 and 1500 jobs to achieve a target of US$131 million in cost savings.
Most of the job losses will be at the car-maker's facilities in Gothenburg, Sweden. Volvo already has a multi-year plan in place that aims to reduce its personnel by about 5 per cent every year, mainly through attrition. Axelsson said the new cuts would be in addition to that.
Parent company Ford, struggling with high costs and falling US sales, is also gearing up for more layoffs and plant closings to stem steep losses in North America.
- REUTERS
