Ford Bucks Trend, Will Offshore Some U.S. Auto Production - Global Trade Magazine
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  July 14th, 2015 | Written by

Ford Bucks Trend, Will Offshore Some U.S. Auto Production

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  • Ford's Wayne plant benefited from a $5.9 billion loan from the U.S. Department of Energy in 2009.
  • Industry analysts: Ford's decision to offshore was motivated by the high costs of manufacturing fuel-efficient vehicles.
  • Ford Focus and C-Max production may be moved to Mexico.

Bucking the reverse of U.S. companies off-shoring their manufacturing operations, global auto maker Ford Motor Co. has announced it will move production of its Focus small cars and fuel-efficient C-Max hybrids from its Wayne, Mich., assembly plant to a facility outside the country.

The move to relocate the Focus and C-Max production off-shore is slated for sometime in 2018.

The Wayne plant was among 13 Ford factories that benefited from a $5.9 billion loan from the U.S. Department of Energy in 2009. Ford has paid back $1.8 billion of that loan, meant to spur development of fuel-efficient cars.

The facility previously produced light trucks and SUVs and the decision to shift to the smaller vehicles was helped by a dramatic up-tick in gasoline prices nationwide.

But circumstances have changed with industry analysts saying the decision by Ford was motivated by the high costs of manufacturing fuel-efficient vehicles and continuing lack-luster sales for both model cars in the first half-of this year.

In April, Ford, the nation’s second largest auto maker, announced that it would cut a shift at the Michigan facility and idle about 700 workers. U.S. first-half sales this year were down 3 percent for the Focus and 17 percent for the C-Max.

The company didn’t indicate where it would move the operation, but in May, the company said it would spend $2.5 billion on engine and transmission plants in Mexico.

Ford has assembly plants there that make Fusion midsize sedans and Fiesta small cars, while its popular Focus model is built at plants in Germany, Argentina, China, Vietnam and Thailand.

“We actively are pursuing future vehicle alternatives to produce at Michigan Assembly and will discuss this issue with United Auto Workers leadership as part of the upcoming [labor] negotiations,” said Ford representative Kristina Adamski, adding the company “must make production decisions that allow it to remain competitive.”


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