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For thousands of US auto workers, the downturn is already here

LORDSTOWN, Ohio - Wall Street is fretting that the auto industry is heading for a downturn, but for thousands of workers at General Motors factories in the United States, the hard times are already here. Matt Streb, 36, was one of 1,200 workers laid off on Jan. 20 - inauguration day for President Donald Trump - when GM canceled the third shift at its Lordstown small-car factory here. Sales of the Chevrolet Cruze sedan, the only vehicle the plant makes, have nosedived as consumers switch to SUVs and pickup trucks. Streb is looking for another job, but employers are wary because they assume he will quit whenever GM calls him back. "I get it," said Streb, who has a degree in communications, "but it's frustrating." Layoffs at Lordstown and other auto plants point to a broader challenge for the economy in Midwestern manufacturing states and for the Trump administration. "This is about economics, not what Trump says. Even if Trump went out and bought 10,000 Cruzes a month, he wouldn't get the third shift back here." The auto industry's boom from 2010 through last year was a major driver for manufacturing job creation. The fading of that boom threatens prospects for US industrial output and job creation that were central to Trump's victory in Ohio and other manufacturing states. "This is about economics, not what Trump says," said Robert Morales, president of United Auto Workers (UAW) union Local 1714, which represents workers at GM's stamping plant at Lordstown. "Even if Trump went out and bought 10,000 Cruzes a month, he wouldn't get the third shift back here." Last week the Federal Reserve said factory output fell 0.4 percent in May, the second decline in three months, due partly to a 2 percent drop in motor vehicles and parts production. Mark Muro, a senior fellow at the Brookings Institution, has compiled data from government sources that show the auto industry punching higher than its weight in job creation in recent years - accounting for between 60 percent and 80 percent of all US manufacturing jobs added in 2015 and 2016. In the first quarter of this year, the auto industry accounted for less than 2 percent of the 45,000 manufacturing jobs created. "There's no argument with the idea that auto has been pulling the manufacturing sled up the mountain for the last three or four years," Muro said.

Ford says utility vehicles are key to global growth

While most of us believe that small, fuel efficient cars are the key to global expansion for US automakers, Jim Farley, Ford's vice president of Global Marketing, thinks otherwise. Last week, we attended an exclusive sneak preview of the Ford Edge Concept in advance of the Los Angeles Auto Show, and Farley told us that it's actually utility vehicles that will help the Blue Oval gain market share overseas. "There is no other segment in our industry that is growing like utilities," he said. "We expect over the next five years this full family of [utility] vehicles to really drive our growth as a company."
And Farley has the numbers to back it up, too. Ford projects overall automotive sales to grow 23 percent from 2012 to 2017, but the company's utility vehicles are expected to boom by an impressive 41 percent during that same period. Much of that growth will be in China, where Ford estimates its utility sales will explode. "The biggest opportunity for us globally for utilities is in China," Farley said. "China utility growth is expected to more than double from where it is today to 2017, which isn't that far away." Most astounding is that Ford projects its own utility sales in China will eventually increase by more than 2,000 percent when smaller crossovers, such as the EcoSport and Kuga (sold as the Escape in North America), and the Edge and Explorer, are factored in.
Ford's VP also expects utilities to lead the way in the struggling European market. "With all the difficulties of the European market, there is one segment that has actually expanded in volume over the last several years even though the market is way down, and that's utilities," Farley told us. Ford estimates that their utility sales will grow 65 percent in Europe from 2012-2017. "The utility segment is projected to grow we think about thirty percent between now and 2017 in Europe, and we think we are going to grow twice that rate as a brand," Farley continued.

2015 Ford Mustang earns Five Stars from NHTSA [w/video]

We already know that the latest Ford Mustang is a pretty potent pony car in terms of its performance potential, but according to the government, it's a safe choice too. The National Highway Traffic Safety Administration recently released its New Car Assessment Program crash test results for the 2015 'Stang coupe, and it came away with top five-star overall ratings in every evaluation. The Mustang received a five-star overall score and five stars for its frontal, side and rollover ratings. The only minor ding was a four-star result just for the backseat in a side barrier crash. According to NHTSA, "Although not included in the star rating, the rear passenger's thoracic rib deflection was elevated." You can check out the full NCAP evaluation, here. According to Ford, the latest Mustang has twice as many airbags and crash sensors as the outgoing model. NHTSA also likes that the pony car offers a rearview camera and forward collision warning – two of the technologies that the agency recommends buyers getting for added safety. Watch the car crash in the video below. 2015 MUSTANG EARNS HIGHEST VEHICLE SAFETY RATING FROM NATIONAL HIGHWAY TRAFFIC SAFETY ADMINISTRATION National Highway Traffic Safety Administration awards the all-new 2015 Mustang a five-star Overall Vehicle Score in its New Car Assessment Program All-new Mustang has twice as many airbags, twice as many peripheral crash sensors and additional pretensioning safety belt technology compared to the outgoing model The new Mustang is the first car to offer four-, six- and eight-cylinder engines that each produce at least 300 horsepower – a 300-horsepower 3.7-liter V6, a more powerful 435-horsepower 5.0-liter V8, and an all-new 310-horsepower 2.3-liter EcoBoost® engine DEARBORN, Mich., Feb. 11, 2015 – The 2015 Ford Mustang received a top safety rating from the National Highway Traffic Safety Administration (NHTSA). The 2015 Mustang earned a five-star Overall Vehicle Score in NHTSA's New Car Assessment Program (NCAP) testing. The New Car Assessment Program is the National Highway Traffic Safety Administration's evaluation program for new vehicle designs established to test for performance against safety threats. Now on sale at Ford dealers, the all-new 2015 Mustang received five stars in the frontal crash test, five stars in the side crash test and five stars in the rollover crash test. "The new Mustang was built from the ground up," said Carl Widmann, Mustang chief engineer.