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Ford shortens summer shutdowns to boost production

Vehicle sales are up in April but down for the year in China, but business is booming in North America where Ford Motor Co. is adding a week of production several plants.


May 9, 2012
by CANADIAN PRESS

DETROIT: Vehicle sales are up in April but down for the year in China, but business is booming in North America where Ford Motor Co. is adding a week of production at several plants, and auto parts supplier Martinrea International is reporting robust sales as is Westport Innovations, a maker of natural gas truck engines.

Ford is boosting production at 13 North American factories, including Essex Engine in Windsor, Ont., which will close for only one week during the summer shutdown period. This will allow the Detroit carmaker to produce an additional 40,000 vehicles in North America this year.

Ford said it would cut in half the normal two-week summer shutdown at six assembly plants and seven engine and parts plants.

Through April, US auto sales have been running at an annual rate over 14 million, up substantially from last year’s 12.8 million. Ford sales through the first four months are up 5% compared with a year ago.

Many analysts are forecasting sales of around 15 million in 2013.

At Ford, most factories have been running at capacity, and the company is adding third shifts at three plants just this month to meet higher demand, said Jim Tetreault, vice-president of North American Manufacturing.

Among them is the Windsor plant which employs more than 700 workers who make engines for the F-150 pickup.

In addition to the Windsor plant, factories that will work the extra week include Chicago Assembly, which makes the Ford Explorer SUV and Ford Taurus and Lincoln MKS large cars; Dearborn Truck, in Dearborn, Mich., which makes F-Series trucks; Louisville Assembly in Louisville, Ky., which will make the new Ford Escape small SUV; Kentucky Truck in Louisville, which makes heavy-duty pickups and the Lincoln Navigator and Ford Expedition big SUVs; Michigan Assembly in Wayne, Mich., which makes the Ford Focus compact, and Kansas City Assembly in Claycomo, Mo., which makes F-150 pickups.

Other factories with the added week include Dearborn Engine, Chicago Stamping, Cleveland Engine No. 1, Lima Engine in Lima, Ohio; Sterling Axle in Sterling Heights, Mich., which makes transmission and engine parts; and the Rawsonville parts plant in Ypsilanti Township, Mich.

Ford now has enough plant capacity to make 2.6 million vehicles in North America, but the company plans to push that up to 3 million this year with added shifts and other changes, spokeswoman Marcey Evans said. The 40,000 are part of the planned increase, she said.

Booming vehicles sales have been good to Toronto-based auto parts company Martinrea International Inc. It has reported an increase in its first-quarter earnings and revenue compared with a year ago.

The company earned $23.1 million or 28 cents per share for the three months ended March 31 compared with a profit of $14 million or 17 cents per share a year ago. Sales totalled $735.7 million, up from $431.2 million.

Martinrea attributed the year-over-year increase to the inclusion of Martinea Honsel in its results as well as an increase in customer production volumes in North America and productivity and efficiency improvements.

The auto parts maker produces metal parts, assemblies and modules and fluid systems for the automotive sector.

Westport Innovations Inc. reported a loss of US$22.6 million in its latest quarter as it ramped up sales of its natural gas powered engines, but it more than doubled its sales from a year ago.

The Vancouver-based manufacturer said revenue totalled $88.6 million for the quarter, up from $38.1 million.

“Customer interest is expanding rapidly, and we see an array of potential investment opportunities with our global partners,” Westport chief executive David Demers said in a statement.

“Adding to our financial growth, we expect to announce new partnerships in each of our business units this year.”

Westport reiterated its 2012 revenue guidance for growth of approximately 50 per cent compared with 2011 with consolidated revenue expected to be between $400 and $425 million.

Meanwhile, vehicle sales in China, the world’s largest auto market, rose in April but are down for the year amid tighter credit and slower economic growth.

The China Association of Automobile Manufacturers said April’s total sales rose 5% from a year earlier to 1.62 million vehicles. Sales for January-April, at 6.4 million vehicles, were down 1.3%.

The increase in April reflected that sales a year earlier were low due to auto production disruptions in the wake of March 11 tsunami and earthquake in Japan.

Auto sales growth in China has slowed from 35% in 2010 to just 2% in the first quarter of this year, as local governments imposed traffic curbs, credit policies were tightened and economic growth cooled.