Ford slashes stock bonuses as cost-cutting deepens

Ford is restructuring its stock bonus program, cutting half of the awards for middle managers in an effort to rein in costs and boost profitability—leaving many to wonder what’s next.

First things first: Stock grants, typically issued in March, are now tied more directly to performance, meaning that only about half of the more than 3,000 eligible middle managers are expected to receive them. Ford says the shift is part of an effort to reward and retain top talent, a move in line with CEO Jim Farley’s push for a higher-performance culture (via Reuters).

• It’s part of Ford’s broader commitment to aggressively cutting costs.

• In November 2024, Ford announced 4,000 job cuts in Europe by 2027, primarily in Germany and the U.K. 

• And the automaker even asked suppliers for their help in lowering costs.

The elephant in the room:  Ford’s EV division remains a major financial strain, with the company losing $5.1 billion on electrification last year—translating to about $37,000 per EV sold.

• In response, Ford has scaled back production, canceled plans for a three-row electric SUV, and reduced work hours at its Cologne plant due to weak EV demand in Germany. 

• The company also paused F-150 Lightning production for nearly two months in Dearborn last fall.

Worth noting: Ford’s stock is down 23% over the past year, while General Motors has gained 23%, benefiting from lower costs and higher profits.

Why it matters: Ford’s EV losses continue to highlight a fundamental challenge for the automaker: finding a sustainable path forward when profitability is still tied to combustion engine sales. Cutting back on stock bonuses and EV investments may help stabilize finances short-term, but it raises concerns about long-term positioning in today’s competitive market.

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