Ford and GM suspend production in Michigan due to parts shortage

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Ford Motor Co. and General Motors Co. will each suspend production in Michigan next week due to supply chain constraints. However, it’s hard not to notice that the chosen facility is responsible for idle small-batch models that they may be able to afford.

General Motors is blocking Lansing Grand River Assembly and Stamping on the grounds that the parts shortage has nothing to do with the current shortage of semiconductor chips. The company later said Russia’s war with Ukraine wasn’t working, dropping two of the most popular excuses for why something wasn’t being done in 2022. Meanwhile, Ford said the chip shortage was related to its temporary shutdown. Flat rock components.

“Global semiconductor shortages continue to impact Ford’s North American plants, as well as global automakers and other industries,” Blue Oval said. “Behind the scenes, our teams work on how to maximize production and remain committed to building every high-demand vehicle for our customers with the quality they expect. All of our North American plants, with the exception of the Flat Rock Assembly Plant, are Operations will begin the week of April 4. »

Ford’s recent production cessation only affects the Mustang, which has become less popular since 2015. Deliveries in North America are now about half what they were six years ago, suggesting the company may choose to let the Mustang take the hit rather than have to suspend truck production again. The manufacturer even warned last month that semiconductor shortages would continue to be an issue for the brand, before announcing that it could lead to a drop in quarterly production.

GM’s suspension of operations in Lansing will also affect production of some of its less popular models, including the Cadillac CT4, CT5 and Chevrolet Camaro.

The CT5 sedan hasn’t been a hit with Americans so far, with just 14,711 U.S. deliveries in 2020 (the first full-year sale) and just 9,446 in 2021, but the Cadillac CT4 is the real deal The model that lost my confidence The brand (along with the XT4) received fewer orders than its larger sibling.

Meanwhile, the Camaro has suffered a similar fate to the Mustang, with sales declining steadily since 2014. While both are strong performance cars, they come amid a widening gap between the rich and the poor and few in the middle class willing to buy minor rides on a regular basis. It could also explain why a more practical Dodge Challenger can hold more bulk than a Ford or Chevy pony car.

Speculation, to be sure. But Ford and GM have recently hinted at plans to revamp their production efforts to prioritize models that are more profitable and sell reliably — essentially cars that cost less to produce, drive reliably and can be sold for more profit. This is especially important now that the pandemic-induced sales terms are largely over, and the public is less willing to be ripped off by dealers running out of product. As a result, the company continues to de-prioritize sales of sedans and coupes in favor of crossovers, pickups and SUVs with stronger financials.

Analysts expect high vehicle prices to persist due to rising material costs, continued supply tightness and talk from a variety of industries. However, they also started discussing which manufacturers are shifting their priorities in an effort to operate lean and which dealers want to continue enjoying higher profitability per transaction for as long as possible.

Unless components unique to the aforementioned models are gone, I’m guessing GM and Ford are tired of having to suspend their lucrative pickups and have to choose which products will take a hit. The Chevrolet Silverado 1500 and GMC Sierra 1500 were assembled in Indiana last week due to a lack of semiconductors. For the same reason, Ford discontinued F-Series production in Kansas City last February. But this isn’t the first time manufacturers have stopped truck assembly, and it likely won’t be the last until supply chains return to normal or manufacturers start making more of their own parts.

The closure of both plants is scheduled to begin on April 4. GM said it expected the Lansing River to cease operations by the 11th, adding that workers would still receive at least 75 percent of their unemployment compensation. Ford is unclear when it expects the Flat Rock to be back in service, although it has also said it will do what it can to make up for product shortages — assuming the need arises.

[Image: Ford Motor Co.]

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