Ford investing $600M, hiring 1,800 at Kentucky SUV plant

Christina Rogers / The Detroit News
Ford Motor Co. is spending $600 million to overhaul its plant in Louisville, Ky., to build as many as six different vehicles at once, including the next-generation Ford Escape compact, the company said Thursday.

The investment will mean an additional 1,800 jobs at the factory, which Ford will fill with new hires, transfers from other plants and laid-off workers.

The plant will close for retooling in mid-December and reopen late next year with two shifts and 2,900 workers, up from its current work force of 1,100.

Mark Fields, Ford’s president of the Americas, announced the investment Thursday at an event at the plant.

The Dearborn-based automaker is refurbishing the factory to make it Ford’s “most flexible high-volume plant in the world.”

After the retooling, Ford will be able to build compact and subcompact vehicles on the same line, without having to halt production to change models.

“Manufacturing flexibility is key to competitiveness, and we are continually exploring ways to raise the bar in this critical area of business,” Jim Tetreault, Ford’s vice president of North America Manufacturing, said in a statement.

Ford hasn’t announced what other vehicle it plans to build in Louisville, in addition to the next-generation Escape, said company spokeswoman Marcey Evans.

The automaker will show a concept version of its next-generation Escape next month at the North American International Auto Show in Detroit.

Ford received $240 million in state and local tax incentives over 10 years to aid in the investment.

The additional jobs in Louisville could open new opportunities for hiring across the country, as Ford seeks to fill jobs left behind by workers transferring to the Kentucky plant when it reopens. In all, Ford estimates it could hire about 1,000 new workers nationwide, Evans said. The new workers will be paid the entry-level wage of $14 an hour; workers transferring to Louisville from other facilities will keep their current union pay, she said.

Earlier this year, Ford moved production of its Explorer SUV to Chicago Assembly — another plant converted to the flexible manufacturing approach.

Prior to the move, it had built the Explorer at Louisville since 1989.

The Chicago factory builds the Explorer on the same platform as the Ford Taurus and Lincoln MKS sedans.

Japanese automakers Honda Motor Co. and Toyota Motor Corp. helped pioneer flexible manufacturing in U.S. factories, but during the past couple of decades, Detroit’s Big Three have adopted the method as well.

General Motors Co. began incorporating the practice in its factories in the early 1990s, followed by Ford later in the decade, said Jay Baron, president of the Ann Arbor-based Center for Automotive Research.

Chrysler Group LLC, too, is working to transform its factories into so-called flex plants, although historically it has lagged behind its rivals, analysts say.

Flex plants allow automakers to switch out models faster, and better adapt to fluctuations in consumer demand for certain cars and trucks.

Under old manufacturing ways, factories had to shut down for months to retool.

Now, they can run continuously and send multiple models down the line at the same time, helping to keep profitable vehicles in stock, said Joe Phillippi of AutoTrends Consulting in Short Hills, N.J.

“To be able to make money on small vehicles, this is the way you have to do it,” Phillippi added.

“You have to flex your production and adapt to what the market is asking for this month this quarter.”

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