… Small cars built in the USA. The last plant in Michighan building small cars will be converted to a large, more profitable vehicle, and production will move to a new Mexican plant that they are building. Comments? Will Donald Trump put Ford out of business when he makes them shut down their Mexican factories? Hmmm…
Fords built in Mexico such as the Fusion, the Focus and some other models are as well assembled as those made in the US. Their reliability shortcomings are DESIGN related, just like Volkswagens built in Mexico.
Nissan has a massive plant there and Mazda is building a large facility as well. New Toyota Corollas previously made in Canada are also built in Mexico. The Canadian plant now makes upscale Lexus models.
Trump’s bark is worse than his bite. Any major trade deals he wants to change or scrap will need congressional approval.
His advisors will tactfully point out which arrangements benefit the US and which don’t. Trump buildings are full of sophisticated electronics made in CHINA!
NAFTA is a 3 country agreement and Canada buys $35 billion more from the US than the US buys from Canada. I’m sure Trump is quite ignorant of that fact when he mouths off on NAFTA.
Scrapping NAFTA will be equivalent to unscrambling an egg!
His real opportunities are in reforming immigration and in foreign policy to let the world know not to screw around with America.
The Donald had no intention of shutting down foreign factories. His own line of clothing is proof of that.
Anazing that Honda and Toyota have no problem building small cars inter US
And Fiat Chrysler is ending production of cars in the US by the end of THIS year!
Looks like GM still has 3 small car plants in the US. Lordstown Ohio for the Cruze, the Sonic in Lake Orion, MI, and the Volt in Hamtramck, MI.
Agree with @Docnick about Trump. Easy to bark on the campaign trail, much harder to pass legislation through Congress.
One big reason is the drop in small car sales, and the little or no profit involved in making them.
Overall US production is pretty much up to prior levels:
Japanese companies are far more EFFICIENT in assembling cars as well as their utilization of labor. Ford lost $1400 on each Escort the made in the US while Toyota and Honda made a good profit on making Civics and Corollas. Hyundai makes cars in the US at a profit although no one told them to do so.
The blame for this is only party UAW intransigence and short-sightedness. Management stupidity in the Big 3 and less than lean operations are also to blame. The Big 3 have yet to learn to apply Total Quality management and asset utilization throughout their organizations.
Nissan builds cars in England with only 10 assembly hours for their Micra. A small VW Polo needs nearly 20 assembly hours in Germany. A Ford Taurus built in the now closed Atlanta plant was Ford’s very best effort with 19 assembly hours.
I agree with Doc and would add that U.S. manufacturers incorporated many of the technologies that enable far more efficient manufacturing processes decades later than Asian manufacturers, technologies such as Design for Manufacturing, Statistical Process Control, and many others. Even when American manufacturers DID incorporate them, they did so reluctantly in a spotty manner and as added activities rather than a real change in basic manufacturing philosophies. I was in the manufacturing industry from the mid-'70s to the late '90s, and was often appalled at the pigheadedness and arrogance of the U.S. manufacturing industry. These ideas all seemed so logical to me.
Ford learned a lot about TQM when the Mazda transmissions performed remarkably better than the Ford built transmissions, even though the design was identical. Did they unlearn all that, not work hard enough, or does it take a long time to determine what measures to use to reduce variability in the manufacturing practice? Maybe all three.
I agree that Mexicans are fully capable of manufacturing good Pulitzer products, as are all people. Their productivity is probably not hampered by inefficient work rules, as is likely the case in UAW and CAW factories. When I worked in a strong Union shop (United Steel Workers), the excess number of workers required to meet the work rules added a huge cost to products we manufactured.
If you look at the Wiki on car plants in the US, really only Honda still builds small cars in any volume (CRV and Civic) in the US. Even the Japanese makers have moved some small car production to Mexico. The Hyundai and Kia plants in the US build the Elantra and Optima respectively, in the US plants. Both are mid-size cars, not their small offerings. Even BMW moved cars out and the SUV/XUV’s into their US plants. We are building lots of cars in the US, but mostly larger cars, trucks and SUV’s.
Can’t speak to what effects good or bad of what Mr Trump may or may not do, but gov’t policy is certainly part of the reason why it makes more sense to Ford executives to ship its operations more and more out of the USA. And likewise, seems a good bet changes in gov’t policy could reverse the process.
Bull. Companies were moving jobs overseas for decades. Look at the Reagan years. Read Jack Welch’s book on business. Written in the 70’s. He proposed companies move manufacturing and engineering overseas back then. And the ONE AND ONY REASON - PROFIT.
And there are many many other non manufacturing jobs that companies have been moving overseas for decades. (Accounting, Software Engineering, Chemiistry, Radiological etc etc).
US has been making 10-12 million cars a year for 20+ years, outside of the recession. I don’t see the problem.
I wish everyone, especially a businessman who is running for president on his business experience, would leave politics out of what is an obvious business decision for Ford’s executives.
Could there be anything more hypocritical than this candidate castigating Ford for moving some of its production to Mexico while he has ALL of his crappy ties and shirts manufactured in Mexico and China?
Jeeze, people, this isn’t a political forum.
Starting something new has advantages. The incumbent manufacturers have a heck of a time ELIMINATING steps/roles in assembly as they get blocked by the union. Been personal witness to that insanity. There’s probably some guy at the end of the line standing there waiting to install the buggy whip that is no longer needed/used but cannot be eliminated…
I don’t think anyone should be using unions as a scapegoat. All unions do is give the workers a voice in governance. The day-to-day operational decisions and long term strategic decisions are still made by management. As a matter of fact, unions have lost a significant amount of influence since their influence peaked in the 1970s.
In the power dynamic between labor and management, management has been winning the tug of war over influence thanks to a political environment that gives them an advantage and court rulings that give corporations some of the same rights as people, but none of the responsibilities or accountability.
As I said above, this decision to move factories to Mexico is a business decision. It’s being done for impartial reasons related to Ford’s responsibilities to its stockholders. If you don’t like the decision, blame the folks who made the decision, not the folks who are losing their jobs.
No jobs are being lost, the factory in the US will be making other vehicles.
OK, so companies move production in search of profit. What’s wrong with profit? No profit, no investors, no company, no employees. If the business climate in the US makes building small cars cheaper in Mexico then we need to change that business climate if we want to keep building cars here. Simple. BTW, Ford made 6.1% profit after taxes in 2015. Not an outrageous amount. GM made 8.1% and 2015 was a good year for cars. Apple made 22.8%. Which one would YOU invest in?
Ford has done business outside the US for about a century. They build where they sell - Europe, Mexico, South America, ect, as does every other large car manufacturer. If it makes sense to build the Focus in Mexico and trucks in the US then that seems like a sound business decision.
That’s good news.