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Ford will lay off 700 employees in Michigan

Lagging sales of compact and electric cars are starting to take their toll on automakers. Ford said Thursday it intends to lay off 700 employees who work at the Michigan Assembly Plant in Wayne, MI, over the next five months. The plant makes Ford Focus and C-Max vehicles. Sales of both have stalled in recent months. The layoffs affect 675 hourly and 25 salaries employees, and will begin in late June and continue through September, according to paperwork filed with state officials. The company expects to re-hire the affected employees elsewhere and use them on temporary basis throughout the summer. Ford spokesperson Kristina Adamski said the affected employees will be "first in line" for other jobs at nearby plants, and UAW vice president Jimmy Settles said he expected all would be re-hired at other southeast Michigan factories by "early 2016." Although industry sales have remained high overall, the growth has come from SUVs and pickup trucks. Conversely, compact cars and alternate-powered vehicles like the C-Max have struggled to find customers amid cheap gasoline prices. Focus monthly sales fell 14.5 percent year over year in March, and C-Max monthly sales dropped 22.9 percent over the same period. It was less than three years ago that Ford hailed the Michigan Assembly Plant as a model for its future, one that would quickly adapt to market conditions through a more flexible assembly process. The plant was retrofitted at a cost of $550 million so that the same assembly line could install electric, plug-in hybrid or gasoline powertrains. Ford produces the Focus, Focus ST, Focus Electric, C-Max Hybrid and C-Max Energi here. At the time, company officials said the flexible line was a way to "not be trapped with dedicated one-trick-pony plants where you have under-capacity or over-capacity situations," said Jim Tetreault, Ford's vice president of North American manufacturing, in November 2012. But that's exactly where Ford finds itself as consumers have turned away from both compact and gas-sipping hybrids and electrics as gas prices have fallen to a national average of $2.49 per gallon, according to Thursday's AAA Fuel Gauge Report. One year ago, gas prices averaged $3.70 per gallon. In perhaps a melancholy twist, the Ford Expedition and Lincoln Navigator that were phased out at Michigan Assembly by the retrofit are once again the types of vehicles that are sought after by consumers.

NHTSA investigating 500k Ford and Mercury cars for lighting failures

The Ford Crown Victoria and Mercury Grand Marquis might be long gone as new models in showrooms, but the National Highway Traffic Safety Administration might check them out yet again for a potential problem. At the urging of North Carolina Consumers Council, the agency may open another investigation into the front lighting control module on vehicles from the 2003-2005 model years, and NHTSA estimates the issue could affect 517,945 vehicles. If the module stops working, it can cause a complete failure of all forward lighting, including the headlights. NHTSA previously investigated the issue in 2008 and 2009 but found no need for a recall, according to Bloomberg. Ford also extended the warranty on the part to 15 years or 250,000 miles. To prompt this new request, the North Carolina Consumers Council received a letter from a woman experiencing the module's failure. Upon further investigation, the council found 604 complaints of this problem on NHTSA's website, including seven crashes. Furthermore, the group has alleged that dealers told customers that the parts to perform the replacement weren't available, despite the extended warranty. According to the government agency, "A defect petition has been opened to evaluate the issue and make a grant or deny decision." Ford spokesperson Kelli Felker tells Autoblog via email, "We will cooperate with NHTSA, as we always do." You can read the council's complete letter to the Feds in PDF format, here. INVESTIGATION Subject : Loss of headlamp/exterior lighting Date Investigation Opened: APR 01, 2015 Date Investigation Closed: Open NHTSA Action Number: DP15002 Component(s): EXTERIOR LIGHTING All Products Associated with this Investigation Vehicle Make Model Model Year(s) FORD CROWN VICTORIA 2003-2005 MERCURY GRAND MARQUIS 2003-2005 Details Manufacturer: Ford Motor Company SUMMARY: The Office of Defects Investigation (ODI) has received a petition from the North Carolina Consumers Council, Inc. requesting a defect investigation of an alleged defect condition resulting in headlight and/or exterior lighting failure on 2003-2005 Ford Crown Victoria and Mercury Grand Marquis vehicles. The petition letter is attached for review. The petitioner alleges a defect in the lighting control module that powers the headlights which can result in the loss of vehicle headlights and/or all exterior lighting while driving. ODI has previously investigated this issue under PE08-066 which was closed without a defect finding.

Ford idling Michigan Assembly Plant to trim Focus, C-Max supply

Ford will be putting the brakes on production at its Michigan Assembly Plant in Wayne, MI, idling production during the weeks of October 28 and December 16. Ford is citing the first drop in US sales in 27 months, a 4.2-percent dip in September, as the impetus for trimming their supplies, according to Automotive News.
Ford's deft management of its supplies has been part of its success over the years, and seeing supplies of Focus and C-Max, the two vehicles built at MAP, rise from 58 and 108 days, respectively, to 71 and 122 days over the span of a month was apparently all that was need to justify the trimming. As AN points out, the rule of thumb for many automakers is to maintain a 60-day supply of vehicles.
"Ford has been focused on keeping their pricing in check. Their operating margin is in double digits. Nobody else is there and they're obviously very proud of that," Alan Baum, an auto analyst with Baum & Associates told AN. Keeping the supply chain operating smoothly and not increasing supplies too much is crucial to that healthy profit margin. After all, a large supply lowers prices ,which, in turn, cuts profit. So while this news might not be great for employees at MAP, who now have an extra two weeks of vacation time, it's far from a sign of problems in Dearborn. Quite the opposite, actually.