Ford on Friday said it was making further truck output reductions “as the company responds to the continued deterioration in the US business environment and the accelerated shift away from large trucks and SUVs”.
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It now expects US industry volume in 2008 – including medium and heavy vehicles – to be between 14.7m and 15.2m units, compared with the previous assumption of 15-15.4m and has lopped 50,000 units from third quarter production plans, now 475,000 vehicles or 25% less than the 2007 Q3.
Fourth quarter production is now slashed 40,000 units to 550,000, a fall of 14% compared with the 2007 fourth quarter.
“As [petrol] prices average more than US$4 a gallon and consumers worry about the weak US economy, we see June industry-wide auto sales slowing further and demand for large trucks and SUVs at one of the lowest levels in decades,” said president and CEO Alan Mulally.
The automaker has also postponed launch of the redesigned 2009 F-150 truck – its top-selling single model line – by about two months due to the industry-wide slowdown in the US truck market and the need to reduced dealer inventory of the current model. The new truck now will go on sale in late autumn.
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By GlobalDataFord also said it would now be difficult to break even on a pre-tax basis in 2009 as planned, and added that Ford Motor Credit Company would now book a pre-tax loss this year.
On the ground, production of the 2009 F-150 will now begin in August at Kansas City assembly plant and in September at Dearborn Truck with one shift axed at both plants and Dearborn idle for most of the third quarter.
Michigan Truck will be idled for nine consecutive weeks from 23 June in line with demand for the company’s full-size SUVs. One shift of production will be axed at Louisville for mid-size SUVs in the third quarter.
Line speed will be reduced at Kentucky truck plant for large pickups in the third quarter and line speed will be reduced at Chicago Assembly in the third quarter for full-size sedans. As previously announced, production of large pickup trucks will wind down at Cuautitlan in Mexico by the end of 2008 and the plant will be retooled for the new Fiesta which will be made from in early 2010.
On the plus side, however, Oakville Assembly will add a third shift for production of the Ford Edge, Lincoln MKX and newly-launched 2009 Ford Flex crossovers and the Kansas City line that produces the Ford Escape, Escape Hybrid and Mercury Mariner and Mariner Hybrid small utility vehicles will add a third shift.
Wayne Assembly’s body and paint shops will add a third shift, and the line speed will be increased for final assembly of the Focus small car.
Production at Ford’s stamping, engine and transmission plants is being adjusted in line with the changes in assembly capacity.
“We view the move to smaller, more fuel-efficient vehicles as permanent, and we are responding to customer demand,” Mulally added.
