Economic experts say the same US trade policies Donald Trump has criticized for decimating American manufacturing are the culprit behind Ford’s announcement. The deficit is largely due to a recall of 2.4 million vehicles for defective door latches that will cost Ford $640 billion.
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Ford Motor Company (NYSE:F) has made an announcement that the company is moving all North American production of small cars from U.S.to Mexico.
“We expect Ford’s performance to be strong through 2018 – with our core business improving, allowing us to invest in the emerging opportunities that will ensure our future success”, he said in a prepared statement.
The spat between Trump and Ford dates to June 2015 when Ford first announced that it would stop producing the Ford Focus and Ford C-Max at its Michigan Assembly Plant in Wayne in 2018 so it could move those vehicles to a lower-cost country.
The company estimates that 2016 results will be US$10.2 billion, 5.5 per cent lower than last year’s record 10.8 billion. Named after its founder Henry Ford, the company had become the first to mass produce a auto and also shared a name with Gerald Ford, the first U.S. President to default into office after the resignation of Nixon.
GM has outlined plans to use its alliance with Lyft to place electric and autonomous vehicles in ride services fleets, while expanding auto sharing through its Maven brand.
The shares of Ford fell 1.9% to close at $12.14 on Sep 14.
Ford executives countered at the time by pointing out the company builds 80 percent of its North American vehicles in the USA, and that it builds more vehicles in the country than any other automaker. The “fortification” will include investments in new products that will help it maintain and build on its strength in each area.
Asked if any jobs would be lost in the move of small vehicle production to Mexico, Fields said, “Absolutely not”.
As reported by Market Watch, Ford Motor Co. Autopilot’s role in the Florida crash is under investigation.
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“I would note that now only one small auto is made in the US – the Ford Focus”. Ford’s automotive operating margin was 6.8 percent a year ago but is expected to rise through 2018. Ford wants to reduce that to 30, which would make production simpler and less expensive. That will save $250 to $300 per vehicle, Ford’s Chief Financial Officer Bob Shanks said.
