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UPDATE 1-Ford to cut 1,700 German jobs

(Adds company comment, background, previous Frankfurt)

DETROIT, Sept 29 (Reuters) - Ford Motor Co.'s German unit plans to cut a further 1,700 jobs by the end of this year through early retirement as Ford's European business seeks to cut costs.

Ford spokesman Ken Zino in Dearborn, Michigan, said Ford-Werke AG would offer early retirements to its salaried and hourly work forces, expecting about 700 salaried employees and 1,000 hourly workers to take the offers.

Cologne-based Ford-Werke currently employs about 38,000 staff, according to company data.

Ford Europe posted a $525 million loss in the second quarter, and its chief executive quit in August. Ford executives have forecast the unit would return to profits by the fourth quarter.

Earlier this month at the Frankfurt auto show, Ford Chief Operating Officer Nick Scheele said Ford would stick with its strategy in Europe, and look for extra cost cuts to make up losses due to lower than expected sales and revenues.