Ford shifting all U
Ford shifting all U.S. small-car production to Mexico
CEO Mark Fields told investors the stir is part of plans to make production simpler and less expensive
Ford plans to eventually shift all North American small-car production from the U.S. to Mexico, CEO Mark Fields told investors Tuesday, even however the company’s production investments in Mexico have become a lightning rod for controversy in the presidential election.
“Over the next two to three years, we will have migrated all of our small-car production to Mexico and out of the United States,” Fields said at a daylong investor conference in Dearborn.
The news sparked a fresh round of criticism of Ford from Republican Presidential candidate Donald Trump, who was campaigning in Flint on Wednesday.
“We shouldn’t permit it to happen. They’ll make their cars, they’ll employ thousands of people, not from this country, and they’ll sell their car across the border,” Trump said during his visit. “When we send our jobs out of Michigan, we’re also sending our tax base.”
The influence on Ford’s U.S. employment will be minimal in the near-term. Ford already builds the Fiesta subcompact and the Fusion mid-size sedan in Mexico. There is an expectation that Ford will build a fresh Ranger mid-size pickup truck in Wayne and possibly a fresh Bronco compact sport-utility.
The automaker also still will make the Ford Mustang at its plant in Vapid Rock, Michigan and will begin making the full-size Lincoln Continental there later this year. It also makes the full-size Ford Taurus in Chicago.
Ford isn’t the very first automaker to stir puny car production out of the U.S. Mexico has become an auto production Mecca for fresh industry investment, surpassing Canada in annual automotive production.
Fiat Chrysler Automobiles said earlier this year it will end production of all cars in the U.S. by the end of this year as it discontinues production of the Dodge Dart in Belvidere, Ill., and the Chrysler two hundred in Sterling Heights, Mich.
It’s an ironic twist for the Wayne because Ford spent $550 million in two thousand ten to convert the aging plant from a big SUV factory to one that could build the efficient Concentrate compact car.
The industry has known for decades that domestic manufacturers fight to make a profit on petite cars in the U.S.
In latest years, automakers that include General Motors, Honda, Hyundai, Nissan, Mazda, Toyota and Volkswagen have announced plans to either expand existing plants or build fresh ones in Mexico. Fiat Chrysler Automobiles also has said it is considering an expansion of its production there.
The number of auto jobs in Mexico reached 675,000 last year, a 40% increase from 2008. U.S. auto jobs enlargened 15% over the same period to more than 900,000, according to the Center for Automotive Research in Ann Arbor.
In addition to the North American Free Trade Agreement, automakers are also drawn to Mexico because of its lower wages, trade agreements with forty four other countries, a sturdy rail and shipping infrastructure and a workforce that has proven it can make high-quality cars.
Ford’s decision to shift the assembly of petite cars to Mexico can reduce costs to a point. But some of these cars are over-engineered.
For example, Fields said the current Ford Concentrate can be ordered in three hundred different configurations of options and colors. Ford wants to reduce that to 30, which will make the production process simpler and less expensive.
Americans choose larger vehicles, especially pickups and higher-riding SUVs and crossover vehicles for their private use.
UAW President Dennis Williams also has repeatedly blasted Ford and other automakers for investing so much money in Mexico.
There is no reason, mathematically, to go ahead and run to countries like Mexico, Thailand and Taiwan, Williams said earlier this year. “We all recognize there is a fat problem in Mexico. So we have to address it as a nation. The UAW cannot do it alone. We are not naive.”
Unifor, the Canadian union that represents autoworkers, also is fighting to hold on to its automotive industry. It is presently in negotiations with the Detroit Three over a contract that expires on Monday. Unifor is worried that three plants could close in the coming years if automakers turn down to commit to fresh investments.
Ford has said it resumes to invest intensely in its U.S. plants and isn’t cutting jobs here. Last fall, the automaker made a commitment to invest $9 billion in U.S. plants and create or retains more than 8,500 jobs as part of a fresh four-year contract with the UAW. Of that, $Four.8 billion goes to eleven facilities in Michigan.
Ford is reassessing much of its business to prepare for a future when it needs to make cars for fresh modes of transport, to generate money from collective use, all without jeopardizing profits still generated by many of its cars and trucks.
The future of smaller cars in the U.S. may depend on the capability to electrify their powertrains and introduce them to ride-sharing fleets where they can generate revenue from fares paid by numerous riders.
Along those lines, Fields and other Ford executives Wednesday outlined an aggressive plan to invest $Four.Five billion over the next four years in fresh battery-powered models in such segments as commercial vehicles, trucks, SUVs and spectacle vehicles.
Ford also reiterated its commitment to developing an autonomous vehicle by two thousand twenty one for use in a ride-hailing service. The company believes that autonomous vehicles could account for up to 20% of vehicle sales by 2030.
Investors didn’t prize Ford or other U.S. automakers when they posted record profits last year and early this year. Now that U.S. sales are leveling off Wall Street is even less enthusiastic about the sector. Ford shares have fallen 12% from the beginning of the year from $14.09 to Tuesday’s closing price of $12.38.
Fields spent the very first half of his 45-minute presentation assuring analysts that Ford’s core business remains strong, especially in its most profitable segments such as full-size pickup trucks, commercial vans and its resurgent Lincoln luxury brand.
But he also said the company must react to a global shift away from private vehicle ownership to one in which individual ownership will be challenged by on-demand collective mobility.
In exploring how a traditional manufacturer can profit in a market where the vehicle becomes a service platform, Fields said the very first question he and fellow executives had to define is “What’s our point of view on autonomy?”
Ford shifting all U
Ford shifting all U.S. small-car production to Mexico
CEO Mark Fields told investors the budge is part of plans to make production simpler and less expensive
Ford plans to eventually shift all North American small-car production from the U.S. to Mexico, CEO Mark Fields told investors Tuesday, even tho’ the company’s production investments in Mexico have become a lightning rod for controversy in the presidential election.
“Over the next two to three years, we will have migrated all of our small-car production to Mexico and out of the United States,” Fields said at a daylong investor conference in Dearborn.
The news sparked a fresh round of criticism of Ford from Republican Presidential candidate Donald Trump, who was campaigning in Flint on Wednesday.
“We shouldn’t permit it to happen. They’ll make their cars, they’ll employ thousands of people, not from this country, and they’ll sell their car across the border,” Trump said during his visit. “When we send our jobs out of Michigan, we’re also sending our tax base.”
The influence on Ford’s U.S. employment will be minimal in the near-term. Ford already builds the Fiesta subcompact and the Fusion mid-size sedan in Mexico. There is an expectation that Ford will build a fresh Ranger mid-size pickup truck in Wayne and possibly a fresh Bronco compact sport-utility.
The automaker also still will make the Ford Mustang at its plant in Vapid Rock, Michigan and will begin making the full-size Lincoln Continental there later this year. It also makes the full-size Ford Taurus in Chicago.
Ford isn’t the very first automaker to budge puny car production out of the U.S. Mexico has become an auto production Mecca for fresh industry investment, surpassing Canada in annual automotive production.
Fiat Chrysler Automobiles said earlier this year it will end production of all cars in the U.S. by the end of this year as it discontinues production of the Dodge Dart in Belvidere, Ill., and the Chrysler two hundred in Sterling Heights, Mich.
It’s an ironic twist for the Wayne because Ford spent $550 million in two thousand ten to convert the aging plant from a big SUV factory to one that could build the efficient Concentrate compact car.
The industry has known for decades that domestic manufacturers fight to make a profit on puny cars in the U.S.
In latest years, automakers that include General Motors, Honda, Hyundai, Nissan, Mazda, Toyota and Volkswagen have announced plans to either expand existing plants or build fresh ones in Mexico. Fiat Chrysler Automobiles also has said it is considering an expansion of its production there.
The number of auto jobs in Mexico reached 675,000 last year, a 40% increase from 2008. U.S. auto jobs enlargened 15% over the same period to more than 900,000, according to the Center for Automotive Research in Ann Arbor.
In addition to the North American Free Trade Agreement, automakers are also drawn to Mexico because of its lower wages, trade agreements with forty four other countries, a sturdy rail and shipping infrastructure and a workforce that has proven it can make high-quality cars.
Ford’s decision to shift the assembly of petite cars to Mexico can reduce costs to a point. But some of these cars are over-engineered.
For example, Fields said the current Ford Concentrate can be ordered in three hundred different configurations of options and colors. Ford wants to reduce that to 30, which will make the production process simpler and less expensive.
Americans choose larger vehicles, especially pickups and higher-riding SUVs and crossover vehicles for their private use.
UAW President Dennis Williams also has repeatedly blasted Ford and other automakers for investing so much money in Mexico.
There is no reason, mathematically, to go ahead and run to countries like Mexico, Thailand and Taiwan, Williams said earlier this year. “We all recognize there is a big problem in Mexico. So we have to address it as a nation. The UAW cannot do it alone. We are not naive.”
Unifor, the Canadian union that represents autoworkers, also is fighting to hold on to its automotive industry. It is presently in negotiations with the Detroit Three over a contract that expires on Monday. Unifor is worried that three plants could close in the coming years if automakers deny to commit to fresh investments.
Ford has said it proceeds to invest powerfully in its U.S. plants and isn’t cutting jobs here. Last fall, the automaker made a commitment to invest $9 billion in U.S. plants and create or retains more than 8,500 jobs as part of a fresh four-year contract with the UAW. Of that, $Four.8 billion goes to eleven facilities in Michigan.
Ford is reassessing much of its business to prepare for a future when it needs to make cars for fresh modes of transport, to generate money from collective use, all without jeopardizing profits still generated by many of its cars and trucks.
The future of smaller cars in the U.S. may depend on the capability to electrify their powertrains and introduce them to ride-sharing fleets where they can generate revenue from fares paid by numerous riders.
Along those lines, Fields and other Ford executives Wednesday outlined an aggressive plan to invest $Four.Five billion over the next four years in fresh battery-powered models in such segments as commercial vehicles, trucks, SUVs and spectacle vehicles.
Ford also reiterated its commitment to developing an autonomous vehicle by two thousand twenty one for use in a ride-hailing service. The company believes that autonomous vehicles could account for up to 20% of vehicle sales by 2030.
Investors didn’t prize Ford or other U.S. automakers when they posted record profits last year and early this year. Now that U.S. sales are leveling off Wall Street is even less enthusiastic about the sector. Ford shares have fallen 12% from the beginning of the year from $14.09 to Tuesday’s closing price of $12.38.
Fields spent the very first half of his 45-minute presentation assuring analysts that Ford’s core business remains strong, especially in its most profitable segments such as full-size pickup trucks, commercial vans and its resurgent Lincoln luxury brand.
But he also said the company must react to a global shift away from individual vehicle ownership to one in which private ownership will be challenged by on-demand collective mobility.
In exploring how a traditional manufacturer can profit in a market where the vehicle becomes a service platform, Fields said the very first question he and fellow executives had to define is “What’s our point of view on autonomy?”