Ford to move production, possibly to Mexico, as UAW talks commence

As the United Auto Workers commence talks with Ford Motor Co. (Dearborn, MI) this week, Ford one-upped the union by announcing that it plans to shift some work abroad. Ford announced last Friday that the company will end U.S. production of the Ford Focus and C-Max vehicles in 2018, possibly near-shoring that work to Mexico where the company has numerous plants already.

Both vehicles have lower profit margins than Ford's top-selling vehicles, such as the F-150 pick-up trucks and the Mustang, both of which were top sellers as reported by the company in its June sales report. "Strong retail momentum continues building for our newest vehicles—including F-150, Mustang, Edge and now Explorer," said Mark LaNeve, Vice President, U.S. Marketing, Sales and Service. "The Ford brand's average transaction prices have increased $2,700 versus a year ago—more than triple the industry average—while our incentives are down, showing how much customers value our investment in new vehicles with the latest technologies."

Ford Fiesta subcompact cars sold in the U.S. are currently built in Mexico, where the automotive industry is booming and billions of dollars are being invested by global automakers in new plants and facility expansions. According to a report in the May/June issue of MexicoNow, Ford this year announced a $1.2 billion investment in a transmission facility in Guanajuato.

Mustang sales were up 54% with 11,719 cars sold in June, representing Mustang's best June performance since 2007. Mustang sales are particularly strong in America's largest sports car region, Southern California, where retail sales are up 157% in June, according to Ford's sales report.

Lincoln retail sales increased 20% versus a year ago, providing the premium brand with its best June results since 2007, said Ford. Lincoln MKC continues to build momentum along with Navigator, which posted a 39% sales increase for June.