Ford moving all small car production to Mexico

Trump had told the congregation, “It was just announced that Ford is moving all small auto production – all of it, 100 percent – to Mexico over the next two to three years”.

The paper also noted that Mexico has become a “Mecca” for vehicle makers and the country’s auto production is now larger than Canada’s. Shifting assembly to Mexico can reduce costs to a point.

Shanks also said one of the “substantial headwinds” for the 2017 outlook is higher commodity costs in North America, where Ford derived about 90 per cent of its second-quarter profit.

She also added that in the past five years, Ford has invested $12 billion in USA plants, creating close to 28,000 American jobs. Ford’s decision to shift small auto production to Mexico comes as sales of cars have declined as SUVs and crossovers have grown in popularity. Those vehicles carry much higher profit margins than for small vehicles.

Ford is investing US$4.5bn in electric vehicle technology and introducing 13 new electrified vehicles – representing 40% of its line-up – by 2020.

Ford isn’t experimenting with autonomous cars and shared-mobility strategies simply to keep pace with industry disruptors and raise its profile on Wall Street, CEO Mark Fields says.

The automaker also reiterated its commitment to developing an autonomous vehicle by 2021.

Ford spokesperson Christine Baker released the following statement: “Ford has been in the United States for more than 100 years”. “The world is moving from simply owning vehicles to owning and sharing them”.

Ford shares have fallen 12% from the beginning of the year from $14.09 to Tuesday’s closing price of $12.38. CNN stated that the Ford factory in Wayne, Michigan, which is west of Detroit, will begin producing different, larger auto models, most likely the Ford Bronco SUV and the Ranger pickup, after the opening of the Mexico plant.

Further, Ford revealed several targets, including delivering growth in line with or more than the global GDP, delivering operating margin of at least 8% in the core business and at least 20% in emerging businesses. “We have always thought about the “thing” and how many “things” we sold”.

However, Fields stopped short of saying what those vehicles will be.

“We see huge social economic and environmental benefits”.