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Ford lays off 130 workers at Ohio medium truck plant


kscarbel2
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Automotive News  /  May 4, 2017

Ford Motor Co. is temporarily laying off 130 hourly workers and eliminating a shift at its politically important Ohio Truck Plant as demand lags for the F-650 and F-750 medium-duty trucks built there.

The layoffs will last more than four months, from May 8 until the end of September. The truckmaker said most of the layoffs will be voluntary. Effected employees, if they have at least one year seniority, will receive roughly 75 percent of their pay while on leave.

Ford moved production of the trucks to Ohio from Mexico in August 2015 as a result of the 2011 labor contract with the UAW. The move made headlines last year during the presidential campaign as then-candidate Donald Trump berated Ford and other automakers for moving some vehicle production to Mexico.

Ford said F-650 and F-750 sales are slumping because the trucks, mostly used for construction or other work, are near the end of their product lifecycle.

“We expect demand to pick back up again in September,” Ford spokeswoman Kelli Felker said. “Some fleets are waiting to place their order until the new model year.”

Ford employs about 1,600 hourly workers at the plant, which has produced 4,856 F-650 and F-750 trucks so far this year, Felker said. It also makes E-series cutaway vans.

The layoffs come as automakers reported light-vehicle sales fell 4.7 percent last month, the fourth straight decline. Car deliveries fell 11 percent, while light-duty truck volume dipped 0.1 percent. It was the first time monthly light-truck deliveries dropped year over year since Sept. 2013.

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Ford lays off 130 workers at Ohio plant

The Detroit News  /  May 5, 2017

Ford Motor Co. has temporarily laid off 130 workers at its plant in Avon Lake, Ohio — jobs it had hoped to preserve by moving production there from Mexico in 2015.

The automaker is taking the truck plant down to one shift to match lagging output with slower customer demand, a spokeswoman said in an emailed statement. The layoffs extend a pattern of widespread shutdowns planned for the summer as carmakers adjust to the U.S. auto market’s recent slowdown following seven years of gains, even as President Donald Trump paints a more upbeat picture.

Mark Wakefield, managing director and head of the automotive practice at consultant AlixPartners. “That shows some people are not assuming this is a speed bump or a plateau and there’s things to be adjusted “Even though incentives are up, you’re seeing some production being taken out,” said.”

The layoffs mark a turnaround for Ford, which had moved production of its commercial F-650 and F-750 trucks from Mexico to Ohio and used the decision to deflect criticism from Trump during the campaign, when he sharply criticized the automaker’s decision to move production south of the border. Ford has since announced it has scrapped plans for the $1.6 billion small-car Mexico facility and will build the Focus compact in an existing plant there.

The laid-off employees are expected to return to work this fall when Ford begins building redesigned versions of the models, the spokeswoman said.

When Ford said in 2014 that it was bringing the trucks back to the U.S., demand for the large commercial vehicles was booming. The automaker began building F-650s and F-750s at the factory near Cleveland after a joint venture in Mexico with Navistar International Corp. disbanded.

Ford invested $168 million in the plant at the time to convert it from making Econoline vans to commercial trucks.

Sales of Ford’s medium trucks fell 20.2 percent last month and are down 10.7 percent this year to 5,016 vehicles, the company said this week.

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Note following line in this press release.....The laid-off employees are expected to return to work this fall when Ford begins building redesigned versions of the models, the spokeswoman said.

Is this a reference to the minor changes KSC posted the other day OR could this mean that 650-750 will get the aluminum cab.  Keep in mind 350-450-550 chassis cabs ar now built in this plant.   seems to me it would make sense to eliminate the steel cab still being used on 650-750.

Or could it even mean an all new medium cab 350-750 chassis as well as the  e series cut away??

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I'd fall over if Ford launched an all-new purpose-designed medium truck (preferably a COE), disconnected in design from their smaller truck range.

One assumes the F-650/750 will get the aluminium cab to maximize economy of scale for Ford, though it has little benefit for most medium truck customers.

Not offering the Cummins ISB or Allison is a gutsy move, but it also makes it hard to take Ford seriously in the medium segment.

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1 hour ago, kscarbel2 said:

I'd fall over if Ford launched an all-new purpose-designed medium truck (preferably a COE), disconnected in design from their smaller truck range.

One assumes the F-650/750 will get the aluminium cab to maximize economy of scale for Ford, though it has little benefit for most medium truck customers.

Not offering the Cummins ISB or Allison is a gutsy move, but it also makes it hard to take Ford seriously in the medium segment.

Kevin-point of clarification-I'm not suggesting a new chassis-just standardizing on one cab.  And if it WAS a completely new medium duty cab, we would be back to the old days when the "pick up cab was 100 (150) to 350 and F-600, F-700 had that cab (modified I'm sure) with a third cab for F-800 and above.

Agree 100% that the ISB/Allison combo is needed and if not the ISB one of Ford's Otosan options.  Many say Ford can't "afford" the cost of adding those options however IMO the incremental cost would be more than offset by the sales gains.

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I think I saw a F-650 near the Romeo Test Track with the new super-duty cab, not sure. Ford is not going to build a new medium duty cab, get over it. Ford has no interest in medium trucks in US. Maybe they will add Allison someday. How long before Turkey becomes like Venezuela? I hope Ford is watching.

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Ford's success with these trucks comes from Ford having the lowest priced trucks in the class 6/7 market.  No, I don't think the truck is competitive with the International DuraStar or Freightliner M2, but it is priced lower and that will make the Fords appealing despite their shortcomings.  Taking that into consideration, I think there is not a lot of incentive for Ford to offer vendor-supplied drivetrain components or a purpose-designed medium duty cab, because doing so with likely cause them to loose their cost advantage.  At that point they compete head-on with International and Freightliner, and Ford is clearly not willing to spend the money to do that.   

I think Ford's position in the market is pretty safe for now.  I think there is a possibility that International or Freightliner could come up with a low-cost (Mexican assembled?) class 6 competitor with a specific drivetrain/gasoline engine option, or possibly International could cook something up with GM (likely in the future), but for now Ford is in a good position if they stay the course. 

    

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