Ford to idle first plants over parts shortage due to Japan quake

April 1, 2011

Ford to idle first plants over parts shortage due to Japan quake

The Detroit News

Ford Motor Co. will have to shutter its first plants next week due to parts shortages related to the Japanese earthquake and tsunami last month.

During a sales call today, Ford sales analyst George Pipas said the Louisville, Ky., plant will be idled next week due to a parts shortage. He declined to identify the part. The plant makes F-Series Super Duty pickups as well as the Ford Expedition and Lincoln Navigator.

The timing of the downtime is fortuitous as sales of large trucks and utility vehicles have fallen off with recent high gasoline prices, Pipas said.

Additionally, the Genk, Belgium, plant that makes the S-Max and Galaxy minivans and Mondeo midsize sedan will also be down next week, which will help prevent parts shortages in the weeks to come.

The plant would have been down for a week in May but Ford moved up the timing to preserve parts.

Ford’s Hermosillo, Mexico, plant will be down the week of April 4 to retool for the new 2012 Fusion and Lincoln MKZ. This was previously scheduled and it is not parts related.

And the Flat Rock, Mich., plant will be down next week because Ford has an abundance of Mustangs. Day supply is about 116 days which is almost double the desired inventory level.

Pipas said total production figures are unchanged.

In a regulatory filing today, Ford said it is assessing the impact of the earthquake and while the automakerhas no production facilities in Japan, it continues to work with suppliers of parts and materials located there to ensure shipments continue with minimaldisruption.

“We also are pursuing other sources of supply as necessary and practicable,” Ford said, noting there still are restrictions on orderingvehicles in certain paint colors because of a pigment that is solely sourced from a plant near Japan’s damaged nuclear reactor.

“Because the situation in Japan continues to develop, supply interruptions related to materials and components from Japan could manifest themselves in the weeks ahead.”

The automaker said if shipment of akey componentis affected and an alternate supply cannot be found,forcing vehicle assembly to stop,it wouldadversely affect the automaker’sfinancial condition.

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