Ford To Resume F-150 Production After Fire At Supplier [UPDATE]

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Ford has been working with other suppliers to rectify the issue.

[UPDATE, May 17] Ford has announced plans to resume production of the F-150 at Dearborn Truck Plant on Friday, May 18. Next Monday, May 21, production of the Super Duty at the Kentucky Truck Plant and the F-150 at Kansas City Assembly Plant will be resumed as well. See the press release area for more details.

At the end of tonight’s second shift at Ford’s Dearborn (Michigan) Truck Plant, all production will cease for the F-150 – Ford’s best-selling vehicle. The production stoppage comes after a fire at Meridian Magnesium Products in Eaton Rapids, Michigan, on May 2, which produces die-cast components for the truck. Production at the company’s Kansas City Assembly Plant in Missouri has already stopped production of the F-150.

The parts shortage is also affecting the production of Ford’s F-Series Super Duty pickups. Production is down at the Kentucky Truck Plant. However, Ford expects production to continue at its Ohio Assembly plant in Avon Lake.

“This is a fluid situation, but we are working closely with our supplier and UAW partners to do everything we can to limit the impact on our production,” said Joe Hinrichs, executive vice president and president of Global Operations. “It’s a full team effort and we’re confident that any impacts will be short term. The good news is we have strong inventories of our best-selling F-Series pickups and other vehicles, and customers won’t have a problem finding the model they want.”

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In the statement announcing the shutdown of F-150 production, the automaker does not note when production at either plant would resume. The company says its working with its supplier base to rectify the parts shortage.

Company spokeswoman Kelli Felker told the Detroit Free Press Tuesday that about 3,600 workers in Kansas City are affected by the shutdown while another 4,000 could be affected in Dearborn. Felker also said there’s no date on when production would resume at the Kansas City Plant, which also produces the Ford Transit.

The fire, which was followed by a series of explosions, at Meridian Magnesium Products remains under investigation. The fire forced the evacuation of nearly 150 people from the building with only two sustaining injuries. Ford production accounts for less than a third of the volume of output from the factory, the automaker says.

According to the Detroit Free Press, Ford built 29,572 trucks in Kansas City and 31,482 trucks at its Dearborn factory last month.

Source: Ford, Detroit Free Press

2018 Ford F-150: First Drive

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  • Ford is resuming production of the F-150 pickup at Dearborn Truck Plant on Friday. Ford team has also successfully repaired the supply chain for Super Duty; production targeted to restart by Monday for Super Duty at Kentucky Truck Plant and F-150 at Kansas City Assembly Plant
  • Ford marshaled a global team of experts, that included partners and suppliers, following a May 2 fire at Meridian Magnesium Products in Eaton Rapids, Mich., to quickly refurbish and relocate tooling needed to produce parts for the Ford F-150, Super Duty and five other vehicles – Ford Expedition, Explorer, Flex and Lincoln Navigator and MKT
  • Because of this quick action, Meridian is producing truck parts again at its Eaton Rapids facility. Plus, Ford airlifted tooling to a Meridian facility in the U.K. to produce parts for F-150, which will further speed production ramp-up
  • Ford Expedition, Explorer, Flex and Lincoln Navigator and MKT production continue uninterrupted
  • Company reaffirms 2018 adjusted EPS guidance range of $1.45 to $1.70; expects adverse impact of $0.12 to $0.14 per share in second quarter due to lost production  1  

DEARBORN, Mich., May 16, 2018 – Ford Motor Company is restarting production of the popular F-150 at Dearborn Truck Plant Friday after just over one week of downtime. The company has also successfully repaired the supply chain for Super Duty, with production targeted to restart by Monday at the Kentucky Truck Plant as well as the Kansas City Assembly Plant that also makes F-150 pickups.

This follows the massive May 2 fire at the Meridian Magnesium Products facility in Eaton Rapids, Mich.

“While the situation remains extremely dynamic, our teams are focused on returning our plants to full production as fast as possible,” said Joe Hinrichs, Ford president, Global Operations. “The ramp-up time to full production is improving every day.”

Ford teams, together with suppliers including Walbridge and other contractors, worked nearly around the clock to get America’s best-selling vehicle franchise back on line as quickly as possible.

The teams removed 19 dies from Meridian’s badly damaged facility, and in one case, moved an 87,000-pound die from Eaton Rapids, Mich., to Nottingham, U.K., via an Antonov cargo plane – one of the largest in the world – in just 30 hours door-to-door. A die is a tool used to cut or shape material using a press.

“Faced with unexpected adversity, the Ford team, including our global supply partners, showed unbelievable resiliency, turning a devastating event into a shining example of teamwork,” said Hau Thai-Tang, Ford’s executive vice president of Product Development and Purchasing. “Thanks to their heroic efforts, we are resuming production of some of our most important vehicles ahead of our original targets.”

Work started immediately in the aftermath of the May 2 fire. Teams removed and remediated safety concerns – including dangling siding – and restored electricity, gaining approval to access the site while debris still smoldered inside.

This allowed Ford and Meridian to safely retrieve and relocate tools to more quickly resume part production and work to minimize the financial impact of the stalled plants.

Ford recovered, repaired and validated most dies that were at the Eaton Rapids facility, and Meridian is now producing parts for the F-150 at two locations – Eaton Rapids and Nottingham, U.K. Production of bolsters for Super Duty is also restarting at the Eaton Rapids plant.

Under normal circumstances, moving tooling the size of a bolster die would take approximately 10 days just to get the proper import and export approvals. However, Ford and its suppliers managed to cut the total time for the entire move to 30 hours, including trans-Atlantic flight time.

When the team removed the die from the Eaton Rapids factory, it was shipped to Rickenbacker International Airport in Columbus, Ohio. Rickenbacker had both the capacity to handle such a large piece of equipment and allowed an Antonov An-124 Russian plane, one of the largest planes in the world – typically used to transport trains, dump trucks and even a 25-foot sea yacht – to take off as soon as the equipment was loaded.

Nearly 4,000 miles away, a team in Nottingham was waiting to receive the die and take it to Meridian’s nearby factory. In between, the Ford team received a U.K. import license for the die – a mere two hours before the plane touched down.

Parts produced at Nottingham are being shipped via daily flights on a Boeing 747 jet until production in Eaton Rapids returns to pre-fire levels.

Inventories of Ford’s best-selling F-Series pickups and other vehicles remain strong and customers won’t have a problem finding the model they want.

1 Adjusted earnings per share is a non-GAAP financial measure. Ford does not provide guidance on an earnings per share basis, the comparable GAAP financial measure. Ford’s earnings per share in 2018 will include potentially significant special items that have not yet occurred and are difficult to predict with reasonable certainty prior to year-end, including pension and OPEB remeasurement gains and losses.

Cautionary Note of Forward-Looking Statements
Statements included or incorporated by reference herein may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are based on expectations, forecasts, and assumptions by our management and involve a number of risks, uncertainties, and other factors that could cause actual results to differ materially from those stated, including, without limitation:

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