Toyota cuts production in June, Ford abandons German plant

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Despite announcing plans for production standardization in early 2022, Toyota has been working hard to deliver on its promises. The Japanese brand is preparing an assembly schedule to return assembly rates to levels considered normal until 2020, as most automakers try to make more profit from production cuts. But other markets have failed to match Toyota’s optimism, with the automaker already scaling back its global production plans – citing usual supply chain constraints due to COVID restrictions and a global semiconductor shortage.

Meanwhile, Ford Motor Co. appears to be abandoning its car assembly plant in Saarlouis, Germany. The plant, which makes the Focus for Europe, could be in danger of closing if the automaker chooses to sell it. While the plant is producing Ford’s next-generation electric vehicles, the products later had to be assembled in Valencia, Spain.

Ford explains his decision in a company statement, saying its commitment to Germany will be maintained through a $2 billion investment in a state-of-the-art electric vehicle center in Cologne. Production is expected to start in 2023, mainly for vehicles using Volkswagen’s MEB electric platform. However, the company believes Spain is only “best suited” to produce electric cars using its own next-generation architecture.

“As part of the Ford+ program, we are committed to building a dynamic and sustainable business in Europe that requires focus and difficult choices,” said Jim Farley, Ford President and CEO. “The European automotive industry is highly competitive, and to thrive and thrive, we can never rest on our laurels with incredibly high-quality products, a great customer experience, ultra-light operations and a talented, motivated team. »

The last line reinforces the pre-existing assumption that Ford knew it would not pay Spanish workers like its German counterparts. However, the manufacturer did not directly say that the Saarlouis plant was doomed, only that its fate hangs in the balance.

There will still be layoffs at both plants though, as EVs require fewer employees to assemble (one of the reasons automakers were so interested in EVs in the first place). Valencia currently employs around 6,000 people, building the Kuga, Galaxy and S-Max for the European market. By comparison, Saarlouis has only about 4,500 people and has suffered more shutdowns due to supply chain issues. Ford has confirmed that the German plant will end Focus production in 2025 and said it will seek “alternative opportunities” for the car’s production. This obviously does not rule out selling the plant to another automaker.

Back to Toyota, the company said it will cut production plans for July by 50,000 vehicles. While the automaker said it would hit its annual global production target of 9.7 million vehicles, it has also been cutting production over the past few months. Although the brand also noted that it is difficult to source chips due to the current shortage of semiconductors, much of this is due to the lockdown in China that will last until 2022. That’s a bit tragic, considering Toyota is one of the few car brands that seems genuinely interested in getting back to business as usual.

So far, the company said it still plans to produce 800,000 vehicles in July. However, Toyota made sure to explain that this is more of a moving target than a real warranty.

“Due to semiconductor shortages and the spread of COVID-19, production schedules may be reduced. However, we will carefully review component supplies to minimize sudden production declines and will continue to do our best to deliver to our customers as soon as possible. Deliver as many vehicles as possible,” The Japanese automaker said in a statement.

[Image: Toyota]

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