From October 28 to December 16, Ford’s Michigan Assembly Plant (MAP) in Wayne, MI, will be idled. Ford is experiencing its first drop in U.S. sales in 27 months, down 4.2% in September, and states that this is the drive behind trimming the supply of cars.
Ford is long known for its adept management of its supplies and sites that as a significant reason for its success. The supplies of the two vehicles made at MAP, C-Max and Focus, rose from 108 and 58 days to 122 and 71 days respectively, in a month, and this triggered Ford’s decision to idle the plant. Many auto makers work to maintain a 60 day supply of vehicles, as noted by Automotive News.
Auto analyst with Baum & Associates, Alan Baum, said, “Ford has been focused on keeping their pricing in check. Their operating margin is in double digits. Nobody else is there and they’re obviously very proud of that.” In spite of the backlog, the cars coming out of MAP are selling well. The Focus just secured its position as Ford’s best-selling model globally, and the popular hybrid-only C-Max has become an alternative to the Toyota Prius and Honda Insight.
Having too many vehicles on the ground or waiting on dealers’ lots can negatively affect pricing, as well as skewing analysts’ reports of vehicle sales health. . Although this isn’t the best of news for MAP workers who will now have two extra weeks of vacation, in the long run this will more than likely be a good thing.
