Wayne, Mich.: Ford Motor Co. has no plans for further US plant closures despite a dramatic drop in demand for pickup trucks and sport utility vehicles, a top company executive said.
But Joe Hinrichs, group vice-president of global manufacturing, also said it makes no sense to have five factories making trucks and sport utility vehicles on one shift each.
Hinrichs said the company’s long-term choices are to either add production to the plants or close some of them.
The company, he said, plans to honour a commitment to the United Auto Workers during contract talks last year not to close more plants, but will offer more buyout and early retirement packages on a plant-by-plant basis as it tries to further reduce its hourly work force to match lower demand for its products.
About 4,200 hourly workers—only about half number the company wanted—took Ford’s most recent offers to leave the company.
Ford makes pickups and SUVs at factories in Wayne and Dearborn, Mich., Kansas City and at two plants in Louisville, Ky. Four are soon to be operating on one shift, which Hinrichs conceded is not the most efficient way to run the company.
Ford already has closed two plants that make pickup trucks in Norfolk, Va., and in Canada.
Hinrichs said the company has three options for its truck and SUV plants: more volume of trucks, production of different products or closure.
“We have to adjust,” he said. “Longer term we can’t have the situations that we have.”
Ford expects to sell 30,000 Focuses in May. If demand continues at that level, it would be above the 235,000-vehicle annual capacity of the Wayne factory, the lone plant that makes them.
The company is studying the possibility of moving workers from truck plants to the Focus factory, as well as increasing assembly line speeds and adding shifts in order to raise production. It also has improved quality so fewer repairs keep the assembly lines running without much interruption, he said.
Ford also will look at making the Focus at another facility.
Ford has said it plans major North American production cuts and layoffs of salaried workers in the face of slumping truck and SUV sales due to record-high gas prices.