Ford Focus and C-Max will no longer come off this assembly line in Wayne, Michigan.
The Ford Motor Company
will move its production of C-Max and Focus small cars to an undesignated foreign nation in three years, the company announced Thursday. A likely new location is Mexico. Focus is already built at plants in China, Argentina, Germany, Russia, Thailand, Taiwan and Vietnam. Germany has a C-Max factory.
Ford currently manufactures those automobiles at its plant in Wayne, Michigan, where it employs some 4,400 workers. The company began laying off 700 workers at the Wayne plant in June:
The company's decision sets a potentially combative tone just days before contract talks are scheduled to begin and runs counter to Ford's normal approach to negotiations, which is to emphasize its ability to cooperate with the union. The United Auto Workers union formally opens negotiations with GM on Monday, Fiat Chrysler Automobiles on Tuesday and Ford the following week.
"It's very, very unusual," UAW Vice President Jimmy Settles says, adding that workers were upset when they were briefed on the news on Thursday. "You never feel good about that kind of information. But I am very, very confident that there will be a replacement product that we will secure for the plant."
Industry analyst Dave Sullivan of AutoPacific called it a "a power move before negotiations start ... Before today, Ford didn't really have anything to negotiate on. The UAW had the upper hand. Now Ford has wiggle room to negotiate for jobs and products."
Ford already makes its U.S.-sold Fiesta subcompact cars in Mexico. With its low labor costs and bilateral trade pacts, Mexico is becoming a hub for auto manufacturing. Honda and Mazda already are making small cars there and Toyota plans to move its Corolla compact operations there soon. Eighteen foreign-owned auto plants are operating in Mexico now, and five more are under construction. A fifth of all cars sold in North America are made in Mexico. The country
has seen a 40 percent increase in auto jobs since 2008, to 675,000. The U.S. increase has been 15 percent, to 900,000.
Head below the fold for more.
Christina Rogers and John D. Stoll report:
The loss of Focus production move deals a blow to the Obama administration’s attempt to encourage U.S. auto makers to make more fuel efficient vehicles domestically. [...]
Ford received a $5.9 billion U.S. loan commitment to retool 11 factories in five states to deliver fuel-efficient technologies. The loan was credited with creating or saving 33,000 jobs and covered hundreds of millions of dollars’ worth of work performed to convert the Wayne, Mich., plant from SUVs such as the Lincoln Navigator to constructing small cars, electric vehicles and hybrids.
How many U.S. workers will ultimately get screwed by the move is unknown. That could depend a great deal on how successful the UAW is in the coming negotiations. Up until now, the chief issues for the union in the contract talks are the continuing discontent over entry-level pay for new autoworkers—$19 an hour, $9 less than what it was before the Great Recession—job security and product guarantees. The union is also greatly concerned about U.S. automakers' foreign investments compared to what they are investing in the United States since past investments have seen hundreds of thousands of automaking jobs vanish.