What, No Hurricane Bounce? Ford Idles 5 North American Plants In Wake Of Slumping Car Sales

Authored by Mike Shedlock via MishTalk.com,

As initially reported by the Census Department, motor vehicle sales were up 1.2% in July following a 0.9% gain in June. At the time, I commented, “This is unbelievably bizarre in the face of actual auto sales reports.”

The Census Bureau revised sales estimates much lower in September as noted in Retail Sales Unexpectedly Decline, Huge Negative Revisions in June and July: Reflections on “Bizarre” Sales Reports.

Today we learn Ford to cut production at five North American vehicle plants due to rising inventory and slumping sales.

Ford Motor Co said on Tuesday it plans to idle five North American vehicle assembly plants for a total of 10 weeks to reduce inventories of slow-selling models.

 

The plants affected include three assembly plants in the United States and two in Mexico, the company said in a statement.

 

The vehicle models include the Ford Fusion and Lincoln MKZ midsize sedans, the Ford Focus compact car, the Lincoln Continental and Ford Mustang, Ford Fiesta and the Ford Transit van.

 

The factories involved employ more than 15,000 people, according to Ford’s website. The company did not say how many of those workers would face temporary layoffs.

Ford Inventory Numbers

  • 111 days’ supply of unsold Mustangs
  • 87 days’ supply of Fusions
  • 103 days’ supply of Transit vans
  • 162 days’ supply of Lincoln Continentals

Automakers aim for 65 to 70 days of inventory of most models.

Note that production cuts are on the way despite the expected bounce in sales due to hurricane damage.

Comments

knukles aloha_snakbar Wed, 09/20/2017 - 16:52 Permalink

Dudes... I'm originally from an auto family.  This day and age, closing 5 plants is unheard of.Old days, everything shutterted annually for deer season (plant maintanance) model changovers and strikes, but not 5 at a time for nefarious reasons like sub-volcanic auto demand.Hah. 

In reply to by aloha_snakbar

Escrava Isaura peopledontwanttruth Wed, 09/20/2017 - 17:26 Permalink

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Rockets are jobs, what are you talking about?  

In reply to by peopledontwanttruth

Rubicon727 peopledontwanttruth Wed, 09/20/2017 - 18:48 Permalink

"There's nothing left that anybody needs. There's no real jobs and the industrialization of this country left decades ago.Exactly so. America is a dead carcass, disemboweled and beheaded by corporate CEOS, Central Banks, Banks like Chase, WellsFargo, Goldman Sachs criminals, and bought off legislators whose only job is to ensure the 5% wealthiest of us continue to devour the very marrow of the bones.

In reply to by peopledontwanttruth

greenskeeper carl knukles Wed, 09/20/2017 - 18:04 Permalink

What the article doesn't really delve into is the surplus of used cars as well. The record number of leases from the last few years are still rolling back onto the dealer lots. Plus, if people's older cars got totaled by the storm,  Ihighly doubt they are going to rush to a dealership and buy a brand new one, since the car probably isn't the only expensive thing they lost. I drive a 13 year old Tahoe that I bought when it was 4 years old. If that car gets totaled, Im going shopping for another 4-5 year old tahoe or suburban, not a brand new one.

In reply to by knukles

Rubicon727 greenskeeper carl Wed, 09/20/2017 - 18:53 Permalink

Across the river from Portland, Oregon, you should see the cities largest auto dealer. He's snagged THREE, very large lots to house all these trucks and autos. Then he has the audacity to unfurl these enormous banners next to a propped up RAM with the words, "GUTS AND GLORY" What a pathetic image he's trying to project. Meantime, all those trucks and cars remain permanently tethered to the vast auto lots. Too bad, Pal. I hope you lose your ass.

In reply to by greenskeeper carl

factorypreset knukles Wed, 09/20/2017 - 19:05 Permalink

Imagine what the impact is going to be from a crap ton of people freezing their credit because of Equifax?  I won't be surprised if we see a lot of purchase activity that relies on credit checks going down the crapper because once the freeze is in place it will make some think twice before unfreezing it to buy some new shit they don't need in the first place.   

In reply to by knukles

j0nx svayambhu108 Wed, 09/20/2017 - 17:23 Permalink

Wouldn’t know it by their prices and their dealers’ unwillingness to deal. These incentives aren’t fooling anyone either. They just jack up the price and then use incentives to lower it to the same ridiculous cost. Cars are outrageous now and dealers all have a no haggle price and believe me they don’t haggle or at least not enough to mention. This is a fairly recent development in the auto sales industry.

In reply to by svayambhu108

Escrava Isaura svayambhu108 Wed, 09/20/2017 - 17:30 Permalink

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svayambhu108: Donald will make more jobs, Sure, when he closes the deal………on the conservatives.    

In reply to by svayambhu108

Last of the Mi… aldol11 Wed, 09/20/2017 - 18:09 Permalink

That's a major part of Ford's problem. They bet the entire company on a V-6. Originally they wanted a $10,000 premium on each of those eco-craps then oil cratered. Coming out of the '08 devastation it was a really stupid stupid move with Americans' love of V8's especially in their trucks. GM went with a self destructing variable displacement just before their bankruptcy so they didn't have to pay the repair bills from a horrible design. That left Toyota with it's 5.7 and truthfully after 80,000 miles it's still BADASS!

In reply to by aldol11

Chippewa Partners Wed, 09/20/2017 - 16:14 Permalink

There's no room on any dealership lot that I can see..........  maybe try cutting the price eh?  Maybe some good old fashioned economic principle, unbeknownst to anyone under say 22 .......        

peippe Wed, 09/20/2017 - 16:17 Permalink

Lincoln continental?they still make those?you guys mean the  bloated  Lincoln SUV, right?cuz nobody wants a 24 foot long two wheel drive land whale anymore.

arby63 Wed, 09/20/2017 - 16:22 Permalink

A little over the top doom here. The decision to idle these plants for several weeks is centered around the need to reduce inventory of models that are not selling. What would we want them to do? Balls to the wall on poor selling models?