Ford Motor faces a complete production shutdown of its profit-driving F-150 pickups for an unknown period of time.
“It is a very fluid situation,” company spokeswoman Kelli Felker said Tuesday.
A major fire at Meridian Magnesium Products in Eaton Rapids, Mich., on May 2 created an unavoidable disruption. Ford has been working with the die-cast parts manufacturer since the incident.
The truck side of the Ford Kansas City Assembly Plant in Missouri shut down this week because of the parts shortage caused by the fire, sending about 3,600 workers home, Felker confirmed.
A decision is pending on when or if the Dearborn, Mich., Truck Plant will shut down, which would affect another 4,000 workers.
“We will be making that decision shortly,” Felker said.
The F-150, America’s top-selling vehicle, is built only at the two sites. No date has been set for reopening the Kansas City plant, Felker confirmed.
A UAW official in Dearborn distributed an alert to workers warning of potential job disruption. A letter from Burkie Morris, UAW president and chairman at the Dearborn Truck Plant, received by workers on Tuesday said:
“The company has informed us that we have enough parts to build vehicles through Thursday. The company is meeting continuously to find a solution to replace and manufacturer (sic) parts that were lost due to the fire at Meridian. According to the company, at some point we will have an interruption in production. At this time, the company doesn’t know for sure when or for how long we will be down. As a result of the fire, there is a great deal of uncertainty in our production schedule at DTP. Adjustments and changes are being made hour by hour as the company is engaged in getting the parts needed to maintain our normal production schedule.”
The letter urges workers to keep their personal contact information updated so they can get updates as information becomes available.
Felker said, “We are working closely with the supplier to manage the situation and to determine next steps.”
Analysts and the company said F-150 inventory is fine for now but the situation is volatile.
“The F-Series is the profit machine for Dearborn,” said Dave Sullivan, manager of product analysis at AutoPacific Inc. “They should be able to weather a short-term shutdown. But if this goes longer than a week, it could really hurt second-quarter performance.”
In April alone, Ford built 29,572 trucks in Kansas City and 31,482 trucks in Dearborn.
Stephanie Brinley, senior analyst at IHS Markit, agreed that panic is premature.
“It’s a little early,” she said. “Not yet.”
On a side note, the Kansas City plant also builds the Ford Transit with the help of about 3,400 workers. They have not been impacted by the shutdown, Felker said.
Meanwhile, production of the Ford Super Duty trucks has stopped, but no layoffs have occurred, she confirmed. The Kentucky Truck Plant in Louisville and the Ohio Assembly Plant in Avon Lake, the only sites where Super Duty trucks are built, are not scheduled for shut down. Felker said Ford has continued manufacturing Expeditions, Navigators and other large vehicles uninterrupted.
The fire also affected production of the Fiat Chrysler Automobiles plant in Windsor, Ontario, that produces the Chrysler Pacifica minivan.
Fiat Chrysler spokeswoman Jodi Tinson said, “The company is adjusting production schedules as needed to minimize plant downtime, but will make up any lost production. FCA continues to work with the supplier’s team on recovery efforts.”
Windsor Assembly employs 6,100 workers on three shifts, according to a company fact sheet.
In addition to the Pacifica and Pacifica Hybrid, the plant produces the Dodge Grand Caravan.
The fire early May 2 has been described as one of the worst fires in the last 40 years in Eaton Rapids, according to the Lansing State Journal.
“The blaze at Meridian Magnesium, the city’s largest employer, forced the evacuation of nearly 150 people from the building, but one city official said it was ‘a miracle’ that only two people were injured,” the State Journal reported.
The fire was followed by a series of explosions, but despite the damage at the 208,000-square-foot plant, which produces instrument panel components, some workers were told they could return to work that day, the paper reported last week.
“The blaze apparently originated in an area of the plant called the ‘tunnel,’ where workers put magnesium scraps on a conveyor belt to be melted down,” the State Journal reported.
The paper noted that the cause of the fire remains unknown. More than 400 people are employed at the plant.