Ford to shut down Michigan plant for 2 weeks amid drop in sales

Article by Anita Panait, on October 25, 2013

Ford Motor Co. will temporarily shut down production at its Michigan Assembly Plant to reduce inventory in response to a recent dip in vehicle sales in the U.S., the first in 27 months. The facility, which builds the Focus compact and C-Max hybrid cars, will be shut down the weeks of Oct. 28 and Dec. 16, spokeswoman Kristina Adamski told Bloomberg in an e-mail.

Days supply of the Focus and the C-Max grew as industry-wide US sales of cars and light trucks dropped 4.2% in September 2013. Ford chief executive Alan Mulally's philosophy of aligning output with demand has allowed the carmaker to post record profit margins in North America of over 10%. Ford, however, is increasing output of other models like F-series pickups and Fusion mid-size cars. Alan Baum, an independent auto analyst at Baum & Associates, remarked that Ford does not “want to get ahead of themselves."

He said that Ford has been focused on keeping their pricing in check. He noted that there is no other carmaker whose operating margin is in double digits.

Ford started October with 122 days supply of the C-Max and 71 days of the Focus, from 108 days and 58 days, respectively, at the start of September, according to the Automotive News Data Center.  

Automakers typically have about 60 days supply of inventory per vehicle.  Ford has posted a 1.1% hike in Focus sales in the US to 188,654 units in the first nine months of 2013. Ford sold 28,254 C-Max in the nine-month period.

Ford Motor Company said that the new Focus was developed using the brand’s very own global C-segment platform. The next-generation of this model, while developed in Europe, was put up for sale in at least 120 markets around the world having 80% parts commonality. Ford disclosed that this same platform will support around 10 vehicles around the world and projects that it will contribute an estimated 2 million units to the 2012 annual production.

According to Kuzak, by unveiling three core bodystyles for the Focus in Paris, it represented another important milestone in the global C-car strategy of the brand. In a few months, he added, the brand will be starting production in both the Michigan and the Saarlouis assembly facilities simultaneously.

This will mark the beginning of the brand’s objective of being able to deliver at least 10 new versions, all coming from the same global platform, he continued. Ford confirmed as well in Paris that its next-generation three-model Focus range will not include a three-door version of the Coupé-Cabriolet variants.

Kuzak explained that since the objective was for this five-door hatchback to have a sleek design similar to a coupe, it allowed for little room in the range to develop a three-door variant.

He said further that the three-model Focus line-up shows an excellent combination of practicality on a daily basis and dynamic, sporty appearance. Kuzak added that customers who want a model with a similar dynamic look but prefer one that offers extra space can avail of Ford’s newest C-car line-up, which is the new C-MAX. As such, customers will surely be able to get the car that will perfectly match their needs.

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Topics: ford, plant, production, sales

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