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NEWS ARTICLE
INDEX

Canada seeks
Pelosi's
support
in push to
lift U.S.
metal tariffs

______

Ford to cut big
commercial-
trucks, Fiesta
in South
America

______

Carmakers
on edge as
Trump keeps
import-tariff
report secret

_______

Ford CFO
could retire
this year,
report says

______

Ford recalls
1.5M pickups
for downshift
without
warning

_______

Volkswagen
officials
expected in
Dearborn for
Ford talks

_______

Ford told
Britain's May
it is preparing
alternative
factory sites

_______

Ford set to
invest $1B
in Chicago
to build new
Explorer,
Aviator

______

After nine
year run,
UAW profit
sharing
routine
takes
a turn

______

Unifor, UAW
to meet
as unions
ramp up PR
campaign
against GM

_______

2019 Lincoln
MKC Black
Label has
new look,
fancy perks

_______

GM to pay
US hourly
workers
$10,750 in
profit-sharing

________

Fiat Chrysler,
Ford sales
bright spots
in mixed Jan

_______

Ford folks
play catch-up
in bid for
respect,
higher
share price

_______

GM Canada
output down
33% while
company
becomes
top producer
in Mexico

_______

Ford hourly
US workers to
get $7,600 in
profit-sharing

_______

Pickups,
vans drive
Ford’s plans

________

Ford CEO to
employees:
Bury 2018
'in a deep
grave'

_______

Canada auto
workers seek
boycott of GM
vehicles from
Mexico

_______

Protests will
continue until
GM decides to
keep Oshawa
plant open

______

Lincoln
Aviator wins
top Readers'
Choice award
at auto show

_______

Canada's vast
pension fund
is sticking with
China even
as political
tensions
mount

_______

Ford sued for
sexual, racial
harassment
at Dearborn
Truck Plant

________

Ford rethinks
Level 3
autonomy

_______

UAW workers
rally downtown
to urge auto
execs to
'invest in us'

______

The 2020
Ford Mustang
Shelby GT500
is the most-
powerful
Ford ever

_______

Ford
expects
better
financial
results
in 2019

_______

Ford, VW
link-up
looms over
Detroit auto
show

_______

Ford sold
1.1 million
F-Series
pickups last
year

_______

Ford to cut
thousands
of jobs in
turnaround
plan

_______

FCA to pay
nearly $800M
in emissions
cheating case

________

Ford cancels
Mexico plant,
expands U.S.
factory and
adds 700 jobs

_______

Ford adds
149,652
vehicles in
Canada to
Takata
airbag recall

________

Auto sales beat
expectations
for 2018, but
2019 doesn't
look as good

______

December 2018
Articles

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News

Canada seeks Pelosi's support
in push to lift U.S. metal tariffs

Josh Wingrove
Feb 21, 2019
Automotive News

Canada is asking U.S. House Speaker Nancy Pelosi to help press the Trump administration to lift tariffs on its steel and aluminum exports.

Canadian Foreign Minister Chrystia Freeland said she met Pelosi and other Democrats on the sidelines of a global security conference in Munich on Saturday. They discussed President Donald Trump’s tariffs on Canadian steel and aluminum imports, Canada’s retaliatory tariffs and the ratification path for the countries’ new trade deal.

“I explained why Canada is so strongly opposed to them and why Canada believes they must be lifted,” Freeland told reporters. Canada has said it’ll lift its retaliatory tariffs, affecting about C$16 billion in U.S. goods ranging from steel to ketchup, when the U.S. cancels its measures.

Freeland delivered a similar appeal last week to Senator Chuck Grassley, the Iowa Republican who chairs the chamber’s Finance Committee. She said she told him “that now that we have concluded our trade negotiation with the United States, that is all the more reason why those tariffs must be lifted.”

Grassley said after meeting Freeland that he believes Canada won’t advance legislation to ratify the successor to the North American Free Trade Agreement if the steel and aluminum tariffs remain in place.

NEW TRADE PACT

Freeland declined to comment, while saying Canada is moving forward and that she’s in touch with cabinet colleagues and lawmakers about ratification.

“We are very seized of the issue and we are working on it. In due course, we will present our plan for ratification of the new NAFTA,” she said. “Canada is definitely focused on our domestic ratification process and we feel we have it well in hand.”

Canada has an election in October, meaning the current crop of lawmakers will likely adjourn in June.

 

Ford to cut big commercial
trucks, Fiesta in South America

Main entrance of the Ford plant in Sao Bernardo do Campo. (Photo11: NELSON ALMEIDA, AFP/Getty Images)

Ian Thibodeau,
The Detroit News
Feb 20, 2019

Ford Motor Co. plans this year to idle a plant in Brazil and exit the commercial heavy-truck business in South America as part of a global cost-cutting effort.

Ford CEO Jim Hackett and the executive team decided the commercial heavy-truck business would have cost too much money to maintain there with "no viable path to profitability," the automaker said Tuesday. The decision comes just more than a month after Ford announced plans to cut hourly and salaried positions in Europe, and possibly shutter plants there.

The automaker builds F-Series pickups, Cargo heavy trucks and the Ford Fiesta compact car at the Sao Bernardo Assembly Plant. The automaker is cutting sales of the Cargo lineup, which includes Transit vans; F-4000s; F-350s; and Fiesta cars in South America this year. It was unclear Tuesday if the Sao Bernardo plant would get new products in the future.

"Ford is committed to the South American region by building a sustainable and profitable business with strengthened product offerings, outstanding customer experience, and a leaner more agile business model," said Lyle Watters, president, Ford of South America. "We know this action will have a major impact on our employees in Sao Bernardo and we will be working closely with all our stakeholders on the next steps."

Ford plans to build its SUV and pickup portfolio in South America to boost profitability. The automaker is phasing out Focus production in Argentina as well. The automaker is taking similar steps in North America as it phases out sedans in favor of more SUVs and pickups.

The decision to exit the South American heavy commercial-truck business is expected to cost Ford $460 million, most of which goes to separation and termination payments for Ford employees, dealers and suppliers there. The charge is part of the $11 billion total Ford expects to incur as a result of its global restructuring. 

Ford announced in January it would cut less-profitable vehicles from its European lineup, cut the workforce and possible close plants to right-side the money-losing business there. Ford has lost hundreds of millions in Europe and South America in recent years despite strong profits in North America.

Under Hackett's direction, Ford is cutting $25.5 billion in global operating costs, slashing the global salaried workforce, and taking an $11 billion charge in doing so. 

Jim Farley, Ford president of global markets, said in January that restructuring plans for Europe and South America will differ from whatever Ford decides to do in North America.

"The situation of South American or Europe is quite different," he said. "Those businesses, we see a really healthy business within them. So restructuring will be a piece of that. Over the next months and weeks, you’re going to hear more."

The commercial vehicle business saved Europe, according to Steven Armstrong, group vice president and president for Europe, Middle East and Africa. South America's fate is different. 

Though Ford's heavy commercial vehicles will flee the South American market, the automaker could still have a commercial presence there. Ford announced in January an agreement to partner with Volkswagen AG on commercial vans and pickups outside of North America. A Ford-VW co-developed pickup could launch in South America, though it's not expected before 2022. 

The automaker has also cut "salaried and administrative costs region-wide" by 20 percent in South America, according to a news release.

 

Carmakers on edge as Trump
keeps import-tariff report secret


Keith Laing,
The Detroit News
Feb 19, 2019

Washington — The auto industry is on edge as it awaits the verdict of the probe ordered by President Donald Trump into whether imported vehicles pose a national security threat, which could lead the U.S. to impose tariffs as high as 25 percent.

Commerce Secretary Wilbur Ross has submitted his recommendations to the president, the department said in a statement Sunday. It offered no insights into the findings. Trump has 90 days to decide whether to act.

Trump has floated the possibility of placing 25 percent tariffs on imported vehicles, most recently in retaliation for a decision by General Motors Co. to idle four U.S. plants as it continues production in Mexico. The premise of the investigation is being mocked in foreign capitals, and European Union leaders signaled Monday such a move would prompt immediate retaliation. 

John Bozzella, CEO of the Association of Global Automakers that represents foreign-based manufacturers, said uncertainty is "freezing investment" as automakers anxiously wait to see if they will be hit with more tariffs. He noted that automakers already have been hurt by tariffs on foreign steel and aluminum put in place by Trump last year after imports of those commodities were deemed threats to the nation's security.

"American auto workers and consumers both who serve to be harmed by tariffs deserve to know what it's in the report," he said. "The bottom line is tariffs would increase the cost of every car sold in America. And we're certain to see retaliation." 

European Union spokesman Margaritis Schinas said Monday that if the U.S. goes ahead with “actions detrimental to European exports, the European Commission would react in a swift and adequate manner.”

German Chancellor Angela Merkel dismissed the idea that German-made automobiles present a national security threat to the United States.  In a speech at the Munich Security Conference on Saturday she pointed out that BMW's largest plant is in South Carolina, not Bavaria. 

"So when these cars, because they're built in South Carolina, are now becoming less threatening rather than the ones built in Bavaria that are supposed to be a threat to the national security of America, it's a bit of a shock."

Bozzella said he fully expects other U.S. trading partners to consider retaliatory tariffs if Trump moves ahead with the levies on imported cars. "We've already seen that with steel and aluminum," he said. 

Matt Blunt, president of the American Automotive Policy Council, which lobbies in Washington for Ford Motor Co., General Motors Co. and Fiat Chrysler Automobiles NV, said Detroit manufacturers are also opposed to additional tariffs on imported cars. They fear their vehicles exported to other nations will be hit with higher duties. 

"We believe the imposition of higher import tariffs on automotive products under Section 232 and the likely retaliatory tariffs against U.S. auto exports would undermine – not help – the economic and employment contributions that FCA US, Ford and General Motors make to the U.S. economy," Blunt said in a statement. 

The review process is referred to as a Section 232 investigation in reference to a 1962 trade law that allows the president to impose tariffs if he determines a security threat exists. It was used by the Trump administration to impose tariffs on imported aluminum and steel.

The Center for Automotive Research said in a report released Friday that a 25 percent tariff on imported cars and parts would increase the average cost of all new cars sold in the U.S. by as much as $2,750 if Canada, Mexico and South Korea are exempted due to trade agreements. The price of vehicles imported from places other than Canada, Mexico and South Korea would go up an average of $3,700.

The average price of a new car was $37,149 in January 2019, according to Kelley Blue Book. Assuming a $3,000 down payment and a 4.7 percent interest rate on a five-year loan, the average monthly payment for a new car sold in Michigan would increase by $73 if $3,700 in tariffs were added to that price.

The Center for Automotive Research estimates the proposed duties would reduce car sales by 1.3 million per year in the U.S.

Bozzella chided the Trump administration for keeping the Commerce Department's report on the national security impact of imported cars secret, noting that a similar report about steel and aluminum was made public immediately last year. 

"Uncertainty in this case is not a neutral or a positive here," he said. "The report hanging over the head of the industry is bad for the investment climate, and that in and of itself is a problem." 

Cody Lusk, president of the American International Automobile Dealers Association, which lobbies for internationally branded dealers in Washington, also chided the Trump administration for keeping the Commerce Department's finding secret. He called the entire investigation "bogus."

"Dealers, their employees and the communities they serve are being treated like pawns by their government," he said in a statement. 

Kristin Dziczek, vice president of the Center for Automotive Research, said the uncertainty is hurting the entire industry.

"It doesn't matter what the rules are, just tell us," she said. "If I had to guess, the report probably says there's national security harm. The president will want to load some tariffs up and hold them over people's heads. That raises the question of 'is this the new normal?'"

 

 

Ford CFO could retire
this year, report says

Ian Thibodeau,
The Detroit News
Feb 18, 2019

Ford Motor Co.'s chief financial officer is planning his retirement, according to a report from CNBC.

CNBC reported Thursday that Bob Shanks, Ford's CFO since 2012, would retire this year, citing anonymous sources. The company declined to comment Thursday on a timeline for Shanks' retirement. The 66-year-old has been with the company since 1997 and has been the CFO since 2012. 

"As all boards of responsible companies do, our board of directors regularly reviews executive succession plans to ensure we have access to the best talent available and are prepared for orderly transitions to take place should the need arise," a Ford spokesman said in a statement.

If Shanks retires in 2019, he'd do so as the Dearborn automaker is in the middle of plans to cut $25.5 billion in costs largely through changes to product development, purchasing and manufacturing. Ford also plans to spend $11 billion to restructure its global business, part of which will involve white-collar layoffs.

Ford announced in January plans to revive its European business through cuts to the workforce and a redesigned vehicle portfolio. The automaker is expected to outline plans for the salaried workforce in North America and other regions by the end of the second quarter of 2019.

 

 

Ford recalls 1.5M pickups for
downshift without warning

Keith Laing,
The Detroit News
Feb 15, 2019

Washington — Ford Motor Co. is recalling nearly 1.5 million F-150 pickups with transmissions that are at risk of suddenly downshifting into first gear.

The Dearborn automaker said Wednesday it is recalling 1.48 million 2011-2013 F-150s with six-speed automatic transmissions that were made in North America. That includes approximately 1.26 million in the United States and approximately 221,000 in Canada.

Ford said a problem with the transmission speed-sensor is the cause.

Ford said it is aware of five reports of accidents that are potentially related to the condition that prompted the recall, including one report of whiplash.

Ford said the affected vehicles were built at its Dearborn Assembly Plant between April 28, 2010 and Oct. 28, 2013 and its Kansas City Assembly Plant between May 18, 2010 and Nov. 18, 2013.

The company said its dealers will update the powertrain control module software in the affected cars for free.

Ford also recalled 27,000 Lincoln Continentals from the 2017-19 model years that have doors at risk of opening while the cars are in motion due to door latches that may not fully engage because of a buildup of silicon contamination. The company said it is not aware of any reports of accidents or injuries resulting from the Continental problems. 

Ford said its dealers will remove and replace the door latch assemblies on all four doors.

Ford also recalled 4,200 Ford Mustang, Lincoln Nautilus and Lincoln Navigator vehicles  manufactured for the 2019 model year that are at risk of having blank instrument panels after startup. The company said it is not aware of any reports of accidents or injuries resulting from the condition.

Ford said its dealers will update the instrument panel cluster software. 

 

Volkswagen officials expected
in Dearborn for Ford talks


Ian Thibodeau,
The Detroit News
Feb 14, 2019

Detroit — Volkswagen AG officials are expected to meet their Ford Motor Co. counterparts in Dearborn this week to continue negotiations on a partnership for electric and self-driving vehicles, sources with knowledge of the situation told The Detroit News.

The automakers are continuing to discuss terms of a deal to work together on futuristic ventures after announcing in January they had agreed to terms for a commercial-vehicle partnership outside of the United States.

Ford and VW had been discussing a linked partnership on both electric and autonomous vehicles, but have since separated the electric vehicle discussions from the discussions. The companies have different plans for electric vehicles, according to a CNBC report Wednesday. The automakers had initially discussed a Ford investment in the German automaker's electric vehicle platform; in return, VW would have invested in Ford's autonomous vehicle unit, a source with knowledge of the negotiations told The Detroit News.

VW officials could not be immediately reached for comment on the status of the negotiations Wednesday.

"Our talks with Volkswagen continue," Ford said in a statement. "Discussions have been productive across a number of areas. We’ll share updates as details become more firm."

As the automakers continue to shape terms of a potentially expansive global partnership, Ford's crosstown rival General Motors Co. and Amazon.com LLC are in talks to take minority stakes in the Plymouth-based electric vehicle company Rivian Automotive LLC. Global automakers are turning to partnerships to help fund expensive investments in the electrified and autonomous vehicles they expect to be the future of the industry.

Ford and VW announced in January that the companies had reached an agreement to partner on commercial trucks and vans outside of the U.S. starting in 2022. The automakers said then they would continue to discuss other partnerships.

"You can't do this alone," Ford CEO Jim Hackett said then. "In these changing times must also come the evolution of this ecosystem."

It's unclear now how much VW would invest in Ford's autonomous spinoff, or in Argo AI, the Pittsburgh-based technology company in which Ford owns a majority stake. Negotiations there are ongoing, sources said. Ford and Argo in December had presented terms for VW to invest in Argo as part of the partnership talks, which VW felt was too expensive, another source told The News.

Another sticking point: VW has offered up Audi AG's Autonomous Intelligent Driving unit, called AID, as part of the negotiations, two sources told The News. Audi is a premium brand in the VW Group, and AID is a wholly owned subsidiary of Audi. AID and Audi are targeting a 2021 launch date for self-driving vehicles. So is Ford.

The Detroit News reported in November that Volkswagen and Ford were negotiating a potential $1 billion investment in Argo. Also on the table is an investment in Ford Autonomous Vehicles LLC, which the automaker set up in July to field outside backing. The potential investment from VW could be lower now, a source said. Reuters reported Wednesday Ford is looking for $500 million.

VW is trying to leverage AID as a bargaining tool in the negotiations surrounding an autonomous vehicle partnership, though Ford and Argo are unsure if the 150-employee unit operating about 12 autonomous test vehicles on public roads is worth as much as VW says, according to two sources.

Argo doesn't have a history of absorbing or using the autonomous technology its automotive partners offer. When it partnered with Ford more than two years ago, Argo did not use any of the technology Ford had been developing on autonomous vehicles. It developed its virtual-driver system in-house. Argo did utilize engineers offered by Ford. The companies are negotiating the value of AID, among other things, as the negotiations continue, sources said. 

Meantime, the automakers might not partner on electric vehicles. Jim Farley, Ford president of global markets, said during a taping of the TV show "Autoline Detroit" that the two automakers have different ideas of how the electric vehicle business will operate.

Ford wants to build higher-priced electric vehicles, like the "Mustang-inspired" utility the automaker plans to introduce in 2020. VW is going for lower-post passenger-cars. Farley said that the automakers are on "different timing" when it comes to electric vehicles, according to a report from CNBC.

"Autoline" would not release a transcript of Farley's recorded comments Wednesday. The show was taped Monday and is expected to air Feb.  21. Both automakers have earmarked billions to fund electric vehicles. Ford plans to spend $11 billion by 2022 on electrified vehicles, and VW plans to spend $50 billion on electrified vehicles by 2023.

 

 

Ford told Britain's
May it is preparing
alternative factory sites

February 13, 2019
Reuters

Ford Motor Co told British Prime Minister Theresa May that it is stepping up preparations to move production out of Britain, The Times reported on Tuesday.

The automaker told the prime minister during a private call with business leaders that it is preparing alternative sites abroad, The Times said.

Ford was not immediately available for comment.

Ford, which operates two engine plants in Britain, last month said that it faces a bill of up to $1 billion if Britain leaves the Europe Union without a deal.

Automakers and other manufacturers have warned about the toll a no-deal Brexit could impose, including higher tariffs, disruption to supply chains and threats to jobs. Britain is scheduled to leave the European Union on March 29.

Another participant on the private call with May said that other companies delivered the same warning as Ford, The Times reported.

"This isn't about contingencies any more - we are taking steps because of the uncertainty. It's real," the participant said during the call.

Last week Nissan Motor Co. said it scrapped plans to build the new X-Trail SUV in Britain and will produce it solely in Japan, saying that uncertainty over Britain's departure from the EU was making it hard for it to plan for the future. Ford is the top-selling automotive brand in Britain, which is its third-largest market and the destination for roughly one in three cars made at its plant in Cologne, Germany. It employs about 13,000 people in Britain.

 

Ford set to invest $1B in Chicago
to build new Explorer, Aviator

The Blue Oval is investing $1 billion in its Chicago Assembly Plant to build the Ford Explorer and the Lincoln Aviator. (Photo: Daniel Mears, The Detroit News)


Ian Thibodeau,
The Detroit News
Feb 12, 2019

Ford Motor Co. plans to spend $1 billion at its Chicago plants to get production of the all-new Explorer and Lincoln Aviator underway.

"We believe in American manufacturing and good-paying (jobs)," Joe Hinrichs, Ford's president of global operations, said at the Chicago Auto Show.

The investment was planned as part of the 2015 contract negotiations with the United Auto Workers. Ford committed then to investing $9 billion over the four years the contract covered. The four-year deal expires later this year, and negotiations for a new contract will begin this summer. 

As part of the 2015 contract, Ford said it would invest $900 million at Chicago Assembly. Hinrichs said the plant will get a new body and paint shop.

The automaker plans to add 500 jobs at its Chicago Assembly plant and Chicago Stamping plant to build the all-new Ford Explorer, the all-new Police Interceptor Utility and the all-new Lincoln Aviator. The Explorer and Aviator will have hybrid variants, and the Explorer will be offered in an ST performance trim.

"Ford's announcement of 500 additional jobs and over $1 billion in plant investments is a testament to the quality and hard work of UAW Ford members," Rory Gamble, vice president of the UAW-Ford Department, said in a statement.

"Every day UAW Ford members head to work, proud of the products they build and the craftsmanship required in vehicles like the Explorer, Aviator and Police Interceptor. Ford’s investment announcement demonstrates a commitment to the dedication of UAW members in Chicago."

Ford's Chicago Assembly plant began making vehicles in 1924, when Ford built the Model T there.

 

After nine-year run, UAW profit-
sharing routine takes a turn


Nora Naughton,
The Detroit News
Feb 11, 2019

The now nine-year routine of hefty profit-sharing payouts to United Auto Workers members is poised to take a different turn.

Driving the upheaval in Detroit's hometown industry is a fundamental shift requiring automakers to redirect precious capital toward expensive electrification, mobility and autonomy efforts — just as they prepare for their quadrennial collective bargaining with the UAW over work in traditional car and truck plants.

The profit-sharing checks risk becoming a footnote as employees — white-collar and blue-collar alike — brace for the year ahead. But industry analysts, economists and even leaders at GM have made it clear that painful moves should be made while the economy is good and employees who lose their jobs can land new ones more easily.

"This time around, the uncertainty in the auto industry — and the fact that all three of these automakers have already announced some reductions — will trim that spending considerably," said economist Patrick Anderson, CEO of the East Lansing-based Anderson Economic Group. "Nonetheless, it is a very good sign that the Detroit-based automakers are making changes while they are still profitable, and that those profits are being shared with workers."

UAW members in the coming weeks will be paid bonuses ranging from $6,000 at Fiat Chrysler Automobiles NV to $10,750 at General Motors Co. now that all three Detroit automakers have reported profits for 2018. But amid the good times, GM and Ford Motor Co. are making the kind of cuts typically seen amid brutal downturns.

That is likely to change the dynamics at the bargaining table. GM is in the throes of a rigorous restructuring plan that included the start this week of more than 4,000 white-collar layoffs. The automaker also reported $11.8 billion in pre-tax profit last year, touted a strong outlook for this year, and used a filing with the Securities and Exchange Commission to outline an equity compensation plan for its GM Cruise LLC employees in Silicon Valley.

"As we begin the next phase of our transformation, I want you to know that we are committed to continuing to strengthen the core business as well as continue to accelerate our work to lead in the future of personal mobility," GM CEO Mary Barra told investors this week. "We are really repositioning this company from one that was trying to be all things to all people in all markets to a very strategic, agile and profitable company."

Ford, which made $3.7 billion last year, is expected to follow GM later this year with a restructuring of its own that will require pruning the global salaried workforce. The cuts already have begun, but are expected to intensify in the second quarter.

Fiat Chrysler, which made $4.1 billion last year, isn't expected to mirror the restructuring efforts of GM and Ford. But the transnational automaker is focusing more efforts on electrification and is expected to grow its manufacturing footprint in the U.S. this year — including reviving a plant in Detroit, CEO Mike Manley confirmed at the Detroit auto show.

But GM in particular has made it clear it won't invest in efforts that don't push the company toward a future it sees as driverless and emission-free. And it won't continue building products that U.S. consumers increasingly don't want.

As the company begins idling five North American plants and laying off white-collar workers, GM is upping its game to attract talent to its autonomous vehicle development operation by offering equity compensation to GM Cruise employees. The new incentive plan was approved last year by the board of GM Cruise, headed by Barra, according to the SEC filing.

GM Cruise CEO Dan Ammann, who moved on Jan. 1 to the driverless car unit from his job as GM president, also has an equity-based compensation plan that encourages him to meet certain targets for the company — including the grant of stock options, which would become valuable in the event of a GM Cruise spin-off.

“Mr. Ammann’s compensation plan is consistent with CEO benchmarks from tech companies with similar market cap to Cruise and is heavily weighted toward the attainment of specific technology and commercial targets,” GM spokesman Tom Henderson said.

UAW workers are likely to ask for their own slice of GM's profitability in the form of wage increases, experts say, not the stock options favored in Silicon Valley. More difficult decisions lie ahead for the industry as automakers weigh whether to invest in traditional product lines or expensive electrification and autonomy efforts. All while the companies deal with an increasingly volatile economic and trade environment.  

"The UAW is going to want base wage increases, and the companies are not going to want to give it to them," said Kristin Dziczek, vice president of Ann Arbor-based Center for Automotive Research. The reason: base wage increases permanently increase fixed labor costs, while one-time bonuses represent one-time charges to the corporations. "Therein lies the rub."

In addition to GM's future-focused restructuring efforts, Ford is looking to trim operating costs by $25.5 billion over the next few years and plans to spend $11 billion reorganizing its European and South American operations. The automaker has not said what percentage of the global salaried workforce will be dismissed once the restructuring is finished. Ford expects to share details by the second quarter of 2019.

At the same time, CEO Jim Hackett rallied employees to push toward profitability as the company transforms, telling employees to "bury" 2018 "in a deep grave."

 

 

Vaughn Geldart
Passes Away

April 4, 1933 to February 7, 2019
Retired November 1, 1988
25.2 Years Service

It is with great sadness that we inform you of the
passing of retiree Vaughn Geldart
on February 7, 2019

Our condolences go out to his family.

Obituary for Vaughn Edward Geldart

Vaughn Edward Geldart
April 04, 1933- February 7, 2019


Born in Cholchester County ,Nova Scotia

Surrounded by family

Survived by his three daughters Elaine Moore (Randy), Julie Charles (Jim), Marianne Turner (Terry).
Grandchildren Leigh-Anne Marquis (Andrew), Allison Bisram (Faith), Jamie Charles, Christopher Charles (Mike), Kevin Charles (Nicole), Jennifer Turner-Wiggins (Tom), Brian Turner (Tara)
Great-grandchildren Moechia, Zachary, Nathan, Bella, Isaac, Lily, Kaylee.
Also survived by his sister Joan.

Predeceased by his wife Dolly Geldart (1991); father Walter, mother Francis; siblings Delbert, Roland, Eric, and Delena

There will be no more morning daily trips on the scooter to the coffee shop to enjoy conversation with the geezers; to solve all the worlds problems with nothing going according to plan.

Downtown Brampton’s ice cream and pretzel shops will see a drop in sales, but will have to worry less about the risk of broken windows from Vaughn banging on the window to let them know he’s outside waiting. To the owner of his favourite downtown breakfast place, it is okay to be late.

Much appreciation to Veterans Affairs and the Palliative Care Team for their compassion.

It was Vaughn’s request to be cremated immediately following his passing; with no funeral service.

Please join us in a celebration of Vaughn's life on Sunday February 17th, between the hours of 4:00 pm and 7:00 pm at Alderlea, 40 Elizabeth Street South, Brampton.

Map


Donations or condolences can be done online here

 

 

Unifor, UAW to meet as
unions ramp up PR
campaign against GM

Greg Layson

John Irwin
Automotive News
Feb 8, 2019

Unifor President Jerry Dias will meet with UAW leadership in Detroit on Thursday as both unions ramp up their campaigns to save five General Motors plants in Canada and the United States.

Dias, speaking with Automotive News Canada on Wednesday, said the meeting is scheduled for Thursday morning. A UAW spokesman confirmed a meeting was scheduled but said he did not know who from the American union would meet with Dias.

GM's plans to potentially close up to four U.S. plants and shutter Oshawa Assembly in Ontario by the end of the year will be the focus of the meeting, Dias said. 

GM’s plans are part of a larger corporate restructuring and have drawn the ire of both unions, who accuse the automaker of abandoning Canadian and American workers for lower wages in Mexico.

“The key issue will be GM,” Dias said. “GM has the profitability. This isn’t a company that’s in bankruptcy or a company that’s in trouble. This isn’t a market that’s in trouble, so it begs the question: Just who the hell do they think they are to close five plants?”

The meeting comes after both unions have ratcheted up their campaigns against GM. Unifor on Sunday aired a commercial during the Canadian broadcast of the Super Bowl accusing GM of leaving Canadians “out in the cold.” 

The union aired the ad even after it received a letter from GM Canada’s lawyers demanding it not broadcast the commercial, which it called “knowingly false and misleading.” The company threatened legal action if it aired. Unifor also plans on airing commercials during high-profile Canadian broadcasts of the Academy Awards, Grammy Awards and NHL games.

Unifor in recent weeks also called for a boycott of all GM vehicles assembled in Mexico and staged various protests, including a two-day blockade of GM Canada’s headquarters in Oshawa. GM Canada said the Mexico boycott would hurt Canadian and American suppliers to those plants and said the blockade had no effect on its operations.

The UAW stepped up its efforts by releasing videos on social media in January that call GM’s plans greedy and unnecessary. The union also urged members to not buy the new Chevrolet Blazer midsize crossover, which is built in Mexico.

The UAW and GM are set to negotiate a new contract for American workers later this year. The fates of Lordstown Assembly in Ohio and Hamtramck Assembly in Michigan, as well as powertrain plants in Warren, Mich., and Baltimore, are likely to be the focus of the talks.  None of the four plants has product allocated for it beyond 2019. 

Unifor will negotiate with GM in 2020, months after the automaker plans on ending production at Oshawa Assembly. Dias is demanding GM honour the current contract and keep production going at Oshawa until the agreement expires in September 2020.

 

2019 Lincoln MKC Black
Label has new look, fancy perks

For 2019 MKC’s old split-wing grille has been replaced this year with a broad rectangle of chrome mesh centered by the Lincoln star. (Photo: Lincoln Motor Company)


Barry Spyker,
Tribune News Service
Feb 7, 2019

The Lincoln MKC is back for 2019 with a face-lift, new safety features and some exclusive perks for those who spring for the top-line Black Label edition.

Beyond the premium leather, unique styling cues and cool color combinations (more on that later), Black Label buyers get four years or 50,000 miles of free maintenance. Lincoln will even pick up and deliver the car for routine service. Buyers also get free car washes whenever and one detailing per year.

There’s also concierge services — book a restaurant from the car — and one free year of CLEAR, the travel service that gets you through security more swiftly at airports and stadiums.

MKC’s old split-wing grille has been replaced this year with a broad rectangle of chrome mesh centered by the Lincoln star. With redesigned LED headlights, the new MKC more aligned with the future look of all Lincolns.

Ironically, Lincoln’s future plans may not include the MKC, which debuted in 2015. Reports are that a replacement may be coming in 2020, something called the Corsair.

Meanwhile, the MKC ($57,480, including $2,495 technology package) forges ahead admirably as a luxury crossover, with a steady and comfortable highway ride. On the twisty roads, it won’t be confused with European foes like Audi’s Q5 and Jaguar’s I-Pace, but it is agile and well controlled on corners. An adaptive damping suspension finds and tames the road’s imperfections in the Comfort mode.

Switch to Sport and the suspension stiffens considerably, making the ride more harsh. Best to keep it in the Normal mode, especially since you must wade through the instrument menu options to get to the three drive modes.

Returning is the 2.3-liter turbocharged inline 4-cylinder engine that makes 285 horsepower and 305 pound-feet of torque. The run to 60 mph is moderately impressive at 6.9 seconds which, by the way, is equivalent to the base 2.0-liter turbo found on lower trims. A 6-speed transmission sends power to all four wheels as needed — AWD is standard on the Black Label.

Few will be towing with the MKC but it’s capable of pulling 3,000 pounds. Fuel economy is in the middle of the class at 18 mpg city, 25 highway for a combined figure of 20.

At night, occupants are greeted with “welcome mat” lights, a classy touch and helpful to avoid puddles or other surprises. Inside, the MKC Black Label is filled with high-end materials and high-tech features. Black Labels are treated to one of three designer schemes: white leather and Argento wood, brown leather and Ziricote wood, or black leather with Alcantara seat inserts. The headliner is done in Alcantara.

Seats are supportive and ventilated and offer 12-way power adjustments with lumbar. But head room and leg room are tight in the rear and not a good place for adults on a trip.

Cargo space lags among foes but is adequate for most weekend needs: 25 cubic feet with rear seats up, 53 cubes with them folded down. That’s good for a couple of suitcases or a week’s worth of groceries. A hands-free liftgate makes loading easier.

Technology is headlined by Lincoln’s easy-to-use Sync3 infotainment system. The system is intuitive and responds quickly to inputs. MKC also has Apple CarPlay and Android Auto, Bluetooth, navigation, a Wi-Fi hotspot and an available 14-speaker THX premium audio system.

A vertical stack of buttons for gear selection sits alongside the center stack. While that’s not ordinarily a problem, this one is rather close to the windshield wiper stalk.

 

GM to pay hourly workers
$10,750 in profit-sharing


Nora Naughton,
The Detroit News
Feb 6, 2019

General Motors Co. will pay about 46,500 United Auto Workers hourly employees profit-sharing checks of up to $10,750 this year, the company said Wednesday.

The Detroit automaker, which made $11.8 billion last year, announced profit-sharing as part of its full-year 2018 earnings report. Its pre-tax profits in North America — the figure profit-sharing is based on — totaled $10.8 billion.

Workers should see the payments in their Feb. 22 paycheck, GM said in a Wednesday statement.

Last year, GM paid about $11,750 to some 50,000 UAW workers on a $11.9 billion North American profit.

Ford Motor Co. announced last month it will pay eligible hourly full-time UAW employees $7,600 in profit-sharing checks set to go out March 14. Fiat Chrysler Automobiles NV will announce its profit-sharing amounts when it reports full-year earnings Thursday.

 

Fiat Chrysler, Ford sales
bright spots in mixed Jan.


Ian Thibodeau,
The Detroit News
Feb 5, 2019

January vehicle sales at Fiat Chrysler Automobiles and Ford Motor Co. sales were two bright spots in an otherwise mixed sales month for carmakers in the U.S.

Fiat Chrysler said its sales were up 2 percent compared to the same time a year ago. Sales in January rose about 7 percent for Ford Motor Co. and slipped about 7 percent for General Motors Co. according to Bloomberg News, which cited people who asked not to be identified because those two companies no longer make their reports public on a monthly basis. 

The annualized industry sales rate slowed to 16.7 million last month, according to researcher Autodata Corp., trailing analysts’ projection for 16.9 million. The pace of car and light truck deliveries was 17.1 million in January 2018.

Industry analysts had expected automakers would see a slight overall increase in sales compared to last year despite the partial government shutdown, bad weather and declining consumer confidence. But Charlie Chesbrough, senior economist with Cox Automotive, said cold January weather and the government shutdown seem to have hurt sales more than he and others anticipated.

"Sales appear to be coming in below expectations for a number of large manufacturers," Chesbrough said. "Car share continues to decline sharply, although the drop has slowed for some OEMs, so we may be approaching the bottom."

Toyota Motor North America reported its U.S. sales fell 6.6 percent in January, with sedans, SUVs and pickups all down. Infiniti USA reported its sales fell 3 percent in January. American Honda sales went up 1.5 percent compared to a year ago due to strong Acura sales.

Hyundai Motor America reported its sales increased 3 percent on strong SUV sales. Hyundai SUVs made up 51 percent of total U.S. sales volume for Hyundai, an all-time record. Nissan Group sales were off 19 percent last month, another larger-than-expected decline. 

Fiat Chrysler's Dodge, Chrysler, Fiat and Alfa Romeo brands all slid in January.

But the company's Ram brand continued propelling Fiat Chrysler's sales increases. Ram saw a 24 percent increase last month. Pickup sales within the Ram brand were up 19 percent, with 34,889 vehicles sold.

Fiat Chrysler said the strength of the U.S. economy could keep sales afloat in 2019.

"We expect a good cadence of new product throughout the year led by our Ram heavy-duty pickup trucks and Jeep Gladiator mid-side truck in the first half of this year," said Reid Bigland, Fiat Chrysler's head of U.S. sales.

The automaker did see Jeep sales slip for the first time in many months. Sales of Jeep were down 2 percent to 58,401 vehicles, though the Wrangler set a new record of 13,204 vehicles, up 11 percent compared to last year.

Part of the reason most companies saw flat or lower sales in January could be rising vehicle prices, according to analysis from Edmunds, a California-based industry analysis company.

"Car shoppers who are returning to the market for the first time in a few years could be in for a big shock," said Jessica Caldwell, Edmunds’ executive director of industry analysis. "Vehicle prices and interest rates are so high right now that consumers are facing the very real possibility of spending thousands of dollars more on a new vehicle than they did last time they purchased a new car."

 

Ford folks play catch-up in bid
for respect, higher share price


Daniel Howes,
The Detroit News
Jan 31, 2019

Forgive the folks running Ford Motor Co. if they feel a little like Rodney Dangerfield.

He’s the ol' comic who constantly complained that he “got no respect,” a familiar lament in Dearborn as the Blue Oval’s long-in-coming restructuring continues to cloud investor sentiment and raise as many questions as it answers. There’s a reason for that: Ford is following its cross-town rivals.

Fiat Chrysler Automobiles NV’s legendary CEO, the late Sergio Marchionne, exited the U.S. car business three years ago, long before the market’s trend toward trucks and SUVs was undeniable. He was ahead of his time, which is why Detroit's No. 3 automaker is planning to add manufacturing capacity and jobs this year, not cut both. 

And General Motors Co.’s Mary Barra is reckoning with her excess North American plant capacity the only way she can right now. She's moving to drop most sedans from GM's U.S. lineup and close four plants in the United States and one in Canada, whatever the predictably furious pushback from politicians, communities and the United Auto Workers.

The net effect of all this ferment for Ford? Despite its own plans to winnow its salaried workforce and whittle its U.S. car offerings to the iconic Mustang and its souped-up variants, Ford suffers by comparison. That's an uncomfortable fact its leadership doesn’t much like but can’t easily deny.

"The shiny new thing — and everybody loves the shiny new thing — is not a 115-year-old company," Executive Chairman Bill Ford said last week at "The Final Word" event closing press days in advance of the North American International Auto Show's opening to the public.

"But the fact is we're actually making ourselves into the shiny new thing, and some people are starting to pay attention. As we get through this year, people will start to really understand what this is all about."

They're not there yet, as Wall Street signaled again this week in yet another tranche of opinions on where Ford is going, how it will get there and whether it's meeting expectations for transparency and speed. The answer: not so much.

“Much more clarity needed on restructuring plan,” Deutsche Bank headlined its Thursday note on Ford, issued less than 24 hours after the automaker posted its financials for last year. “While investor frustration with the perceived slow progress of Ford’s restructuring actions remains understandably high, it seems their benefit could accelerate this year.”

Adds Morgan Stanley: "We continue to see Ford as an emerging turnaround story, but still believe investors are waiting for a more significant 'capitulation' in results ..., a potential downgrade in the credit rating, a potential cut in the dividend or further transparency on strategy before increasing exposure. In short, while the ingredients are there ... we think it's too early to turn positive on Ford."

And David Kudla, CEO of Grand Blanc-based Mainstay Capital Management LLC, said: "Wall Street remains unimpressed and disappointed and the stock price is showing it. Ford's stock price is suffering because it discounts the future and investors are unclear as to what the future is at Ford."

External forces neither Ford nor its competitors can control don't help. Steel and aluminum tariffs are driving materials costs higher, eating profits. U.S. trade tensions with Canada and Mexico, China and the European Union drive uncertainty and complicate decision-making. A shutdown of the federal government that runs to the end of March could push growth in GDP close to zero, says the Trump administration's own economist.

In that context, the Blue Oval is playing catch-up. The less than three-year tenure of former CEO Mark Fields wasted valuable time that his successor, Jim Hackett, is being forced to make up in what he calls a "redesign" of the core automotive business — a necessary precondition to optimizing the financial gearing needed to pay for the Auto 2.0 spaces of mobility, autonomy and electrification.

Right idea, but his method is what's proving exasperating to investors and analysts paid to second-guess management. Where Marchionne was a proud iconoclast and Barra is a decide-and-go kind of CEO, Hackett is a methodical Big Thinker whose style does not neatly mirror Wall Street's assumptions of what an auto CEO should be.

But, then, neither is Ford. It stands alone among American automakers, a century-old industrial cornerstone whose founding family still exerts control over the Blue Oval's direction, culture and top leadership. Barra's GM, by contrast, is a more pure investor play, reconstituted in a federal bankruptcy that deeply influenced the senior leaders who survived and focused their attention on investors.

That's why Morgan Stanley last week described Barra as "one of the most effective CEOs in the business — a reputation earned from a track record of success, capital return, product execution and decisive actions under extreme pressure." Namely, from Wall Street, traditional rivals and emerging competition from Silicon Valley.

Among the major global automakers, GM and its capital structure also stand alone. Outside the United States, FCA is controlled by Exor SpA, the founding Agnelli family's holding company. BMW AG is controlled by the Quandt family. The Porsche and Piëch families, along with the German state of Lower Saxony, control more than 70 percent of voting rights in Volkswagen AG. The French government owns 15 percent of Renault SA, the controlling partner in the Renault-Nissan alliance. 

But it's on Wall Street, epicenter of impatient American capital, where Ford and GM compete for credibility, leadership and respect — a decades-long contest GM appears to be leading, at least for the moment.

 

 

GM Canada output down 33%
while company becomes
top producer in Mexico

Nick Bunkley
Automotive News
Jan 30, 2019

Mexico in 2018 accounted for more than a quarter of General Motors' estimated North American production for the first time, a proportion that will rise further if the company follows through with plans to end production at five plants in the United States and Canada this year.

GM is now Mexico's largest auto producer, topping Nissan Motor Co. in a year when it reduced output by an estimated five per cent in the United States and an estimated 33 per cent in Canada, according to the Automotive News Data Center. GM built 834,414 vehicles in Mexico last year, an increase of 3.6 per cent, vs. a 10 per cent decrease to an estimated 763,257 for Nissan, which had been No. 1.

GM's higher Mexican output at a time when it's eliminating jobs in the U.S. has angered President Donald Trump and other politicians as well as union officials set to negotiate a new contract with the automaker this fall.

"We want those cars here," Rep. Debbie Dingell, a Michigan Democrat and former GM lobbyist, said in a statement to Automotive News. "That's why we have to support a public policy environment that encourages production in the U.S."

Overall production in Mexico fell by one per cent in 2018. That's the first time Mexico production has declined since automakers began opening a flurry of plants south of the U.S. border to take advantage of lower costs from nonunion labor and favourable trade agreements with overseas markets.

But production in Mexico is expected to remain stable in the coming years, particularly now that the U.S., Canada and Mexico have signed a renegotiated free-trade agreement, said Eric Anderson, a senior analyst with IHS Markit.

GM imports 36000 vehicles from Mexico to Canada annually.  The automaker also says the company only imports three vehicle models from Mexico out of 47 it sells in Canada.

Unifor President Jerry Dias accused General Motors of “using Mexican workers for corporate profits” by “paying them $2 an hour.” 

Total North American production declined for a second consecutive year. Production was down an estimated 2.6 per cent overall, including an estimated two per cent in the United States and an estimated 8.8 per cent in Canada.

Just three automakers built more vehicles in the U.S. in 2018: Tesla, up 151 per cent; Volkswagen Group, up an estimated 22 per cent; and Honda Motor Co., up 2.7 per cent. Ford remained the largest U.S. producer, building nearly 2.4 million vehicles domestically vs. about 2.1 million for GM.

In Mexico, Toyota Motor Corp. built 49 per cent more Tacoma pickups in Tijuana, and Hyundai-Kia made 33 per cent more small cars in Nuevo Leon. Besides those two and GM, the only other automaker to raise output in Mexico was Fiat Chrysler Automobiles — by 369 vehicles. Honda and Ford joined Nissan with double-digit cutbacks.

A GM spokesman said the company hasn't added any capacity in Mexico for a decade and has no plans to do so. Its 2018 gain there stemmed from falling demand for GM's U.S.-made cars and surging popularity of crossovers such as the Mexico-made GMC Terrain and the Chevrolet Equinox, which is built in both Mexico and Canada. Production of the Equinox and Terrain in Mexico nearly doubled from 2017, but GM built 11 per cent fewer pickups and 74 per cent fewer cars in Mexico last year.Mexico represented an estimated 30.8 per cent of GM's 2018 light-truck production and an estimated 25.7 per cent of its total output in North America. Ford got 9.7 per cent of its North American supply from Mexico but doesn't build any pickups, SUVs or crossovers there.

GM is poised for another Mexico production increase in 2019 with the addition of the Chevy Blazer, which started coming off the Equinox line at its Ramos Arizpe plant in November.

The decision to make the Blazer in Mexico — reached, company officials say, when sedan sales were higher and GM had less U.S. capacity to spare — has been a particularly sore spot for Unifor and the UAW, which learned of it on the day GM reduced its Chevy Cruze plant in Lordstown, Ohio, to one daily shift. GM says it will end production in Lordstown after March 1, followed later in the year by assembly plants in Detroit and Oshawa, Ont., and propulsion plants in Michigan and Maryland.

Unifor proposed the Blazer be assembled in Oshawa as a way to save the plant there.

Unifor last week blocked access to the headquarters of GM Canada in protest of the potential plant closure.

 

2018 production

Change from 2017

Ford

2,378,440

–3.9%

GM*

2,127,749

–5%

FCA*

1,263,511

–0.5%

Toyota

1,241,615

–1.7%

Honda

1,240,487

2.70%

Nissan

835,321

–10%

Hyundai-Kia**

574,159

–7.7%

Subaru

359,399

–1.1%

BMW

356,749

–3.9%

Mercedes-Benz*

304,852

–7.6%

Tesla

254,530

151%

VW*

137,348

22%

Total

11,074,160

–2%

*Estimate

**Kia figures are estimated.

Source: Automotive News Data Center

 

 

Ford hourly US workers to
get $7,600 in profit-sharing

The company said Wednesday that profit-sharing checks would go out March 14. The amount is based on North American earnings, which was $7.6 billion before interest and taxes in 2018. (Photo: JEFF KOWALSKY, AFP/Getty Images file)


Ian Thibodeau,
The Detroit News
Jan 29, 2019

Dearborn — Ford will give eligible hourly full-time United Auto Workers employees $7,600 profit-sharing checks this year.

The company said Wednesday that profit-sharing checks would go out March 14. The amount is based on North American earnings, which was $7.6 billion before interest and taxes in 2018.

Last year, 54,000 UAW workers got $7,500.


 

Pickups, vans drive Ford’s plans


Alexandra Semenova
and Keith Naughton,
Bloomberg News
Jan 28, 2019

Ford Motor Co.’s haul from selling just pickups and commercial vehicles rivals household-name companies including IBM and Boeing.

Revenue from the automaker’s truck and van business totaled $72 billion in 2017, Ford disclosed in two presentations to investors in as many weeks. That’s more than the trailing 12-month sales of U.S. companies including Intel Corp., Walt Disney Co. and PepsiCo Inc., according to data compiled by Bloomberg.

As Chief Executive Officer Jim Hackett engineers an $11 billion restructuring of Ford, its massive pickup and van business will play a foundational role. The rise of online shopping is dramatically increasing demand for vehicles best suited to deliver packages to doorsteps. In one indication ofjust how desirable the once-dreary commercial-vehicle segment has become, the world’s largest automaker, Volkswagen AG, just teamed up with Ford to develop models including Transit vans.

“Ford has always been strong in that segment,” Michelle Krebs, an analyst at Autotrader, said of commercial vehicles. “It’s not particularly sexy and no one pays much attention to it, but it makes a lot of money.”

Ford has never broken out information on how lucrative this business is, according to a spokesman. The company opened up about it first at a Deutsche Bank auto conference this month, and again in its earnings call Wednesday.

The automaker reported that its 2.4 million truck and van sales worldwide in 2017 generated earnings before interest and taxes of $10 billion. The operating-profit margin for the business was 14 percent — miles ahead of the 4.4 percent margin for Ford’s entire auto operations in 2018.

“We have the most extensive global commercial-vehicle lineup and portfolio of any company, and we are about to make it much stronger,” Jim Farley, Ford’s president of global markets, said at the Deutsche Bank conference. He called the company’s 44.5 percent share of the North American commercial truck and vans segment “completely dominant,” saying Ford outsells its four closest competitors combined.

The crown jewel of Ford’s truck business is its F-Series pickup line, which hauls in the bulk of the company’s profits. U.S. deliveries rose in 2018 to 909,330, making it the top-selling vehicle of any kind in America for the 37th consecutive year.

The F-Series outsold the nearest competitor by the biggest margin ever last year, Hackett said at the Deutsche Bank conference. He called Ford’s commercial vehicle business a “global juggernaut.”

To maintain its dominance, Ford is working to “future-proof” these models, Farley said. “We’re going to be electrifying the F-Series, both battery-electric and hybrid, and we’re doing the same for Transit.”

 

Ford CEO to employees:
Bury 2018 'in a deep grave'


Ian Thibodeau,
The Detroit News
Jan 27, 2019

Ford Motor Co. CEO Jim Hackett wants his employees to "bury" 2018 "in a deep grave" and focus on driving company profit margins to double those reported last year, according to an internal company-wide email obtained by The Detroit News.

"I made a comment saying 'I’m not happy with 2018.' I’m not," Hackett wrote in a Thursday email to employees. "That doesn’t mean I’m unhappy with you or your colleagues, but we can’t become who we need to be if we accept mediocre results. And 2018 was mediocre by any standard."

Ford reported its full-year profits fell more than 50 percent last year compared to 2017. Using the company's adjusted financial results, Ford's global business pulled in a $7 billion profit, operating at a 4.4 percent margin. Hackett in his email to employees said the automaker should be targeting double that, or a $14 billion profit, if the company is to hit the 8 percent margin target.

A Ford spokesman said Friday that Hackett used the $14 billion figure to illustrate to employees how profitable Ford could be if it was operating at the 8 percent global margin target the automaker has set as a post-restructuring goal. Details about the letter were first reported by Reuters.

Ford officials, including Hackett, told investors this week that 2019 should bring better financial results than last year as pieces of the company's ongoing global reorganization begin to take hold. The automaker plans to cut $25.5 billion in costs by 2023 and spend $11 billion to reorganize the global business model. In North America, Ford is currently going through its white-collar ranks to potentially eliminate positions there.

Hackett told employees in the email that he becomes mad "for a short time" when he realizes the company is not operating to its potential. 

"I know that our competition hasn't been better than us by magic," he wrote. "I hate shallow or mediocre outcomes. I don't want to be there again."

Ford last year lost millions in every market around the globe, except North America. The automaker has announced moves in Europe and India to boost profits there, and has appointed new leadership in China to restructure the business there, which was responsible for the $1.1 billion loss the company took in its Asia Pacific market last year.

Only Ford's North American business posted a profit last year. Ford made $7.6 billion in North America, operating at a 7.9 percent margin in the region. Leadership in North America is targeting a 10 percent margin.

Meantime, Ford officials point to plans to launch several new vehicles in 2019, including a redesigned Explorer and Escape, two of the company's strongest sellers, as one of the reasons 2019 should bring better financial results from the Dearborn automaker. It  is introducing the Lincoln Aviator, the Ford Ranger launched in January, and Ford plans to update its Super Duty pickup this year.

Ford also recently announced plans to cut costs and re-examine markets in Europe. Jim Farley, president of global markets, said this week that Ford could exit countries in Europe where it wasn't selling many vehicles and focus on countries there where it has better market share.

Adam Jonas, equity analyst with Morgan Stanley, said in a Friday note that though Ford leadership seemed more "bullish" on the year-end earnings call this week, he's cautious. Ford's bottom line will take hits from the global restructuring before financials improve, he said.

Ford stock closed trading Friday up 3 percent to $8.86 per share. The stock is down more than 20 percent since Hackett was appointed CEO in May 2017.

Hackett told employees in his Thursday email, issue no. 24 of a series called "The Huddle," that Ford this year would plan the "implementation" of the moves Hackett and his team have decided need to be made.

"I’m seeing those plans to get the products in shape, the markets restructured and the alliances up and running," he wrote. "I have more to do in my own reflection of what should change to ensure that we win."

Letter to employees from CEO James Hackett (pdf)

 

 

Canada auto workers seek boycott
of GM vehicles from Mexico

The Canadian Press
Jan 26, 2019

DETROIT — The Canadian auto workers union is asking people in Canada and the U.S. to boycott General Motors vehicles made in Mexico.

The Unifor union is asking people not to buy trucks or SUVs with vehicle identification numbers that start with the number three, which signify that they are made in Mexico.

Unifor says it will publicize the boycott with television, newspaper and billboard advertising in both countries.

In November GM announced plans to close its car factory in Oshawa, Ontario, near Toronto, costing the jobs of about 2,600 blue-collar workers. It also has plans to close four U.S. factories but will negotiate those with the union. The closures are part of a broader restructuring that will cut 14,000 factory and salaried positions as GM tries to slim down to focus capital spending on autonomous and electric vehicles.

GM says it has too many plants that make cars as the market in both countries has shifted toward trucks and SUVs. It says the boycott could cause damage to the wider Ontario economy.

Unifor National President Jerry Dias (DYE-Azz) says that in 2016 contract talks, GM agreed to keep the Oshawa plant open until the contract ends in September of 2020. He wants the company to return to the bargaining table to talk about keeping Oshawa open permanently.

Dias accused GM of closing Oshawa and the U.S. factories while at the same time ramping up production in Mexico, where he says workers are paid $2 per hour. He says the company now makes over 600,000 vehicles per year in Mexico. "We are asking you to stand up to 'Greedy Motors,'" he said at a news conference Friday in Toronto.© The Associated Press FILE - In this April 23, 2018, file photo, the logo for General Motors appears above a trading post on the floor of the New York Stock Exchange. The Canadian auto workers union is calling on people in Canada and the U.S. to stop buying General Motors vehicles made in Mexico. The Unifor union wants people to boycott vehicles with identification numbers that start with three. Unifor says it will publicize the boycott with television, newspaper and billboard ads. So far the United Auto Workers union in the U.S. is not joining the effort. (AP Photo/Richard Drew, File) Dias said the company ultimately plans to pull all of its manufacturing out of Canada, where it has two other factories in Ontario. Asked if the union would strike GM's Canadian facilities, Dias said: "We are not ruling out anything and we are not going to talk today about future plans."

GM said there are more than 60 Ontario-based auto parts companies that send components to Mexico, including a transmission plant in St. Catherines, Ontario, and stamping operations in Ingersoll, Ontario.

"The threat of collateral damage for Ontario-based auto suppliers, auto dealers and workers is concerning, especially for an Ontario economy that is now open for business, with every opportunity to now benefit from increased trade with Mexico," GM Canada Vice President David Paterson said in a prepared statement.

So far the United Auto Workers union in the U.S. is not joining the boycott effort, but Dias said the unions plan to talk in early February.

Since the announcement, GM has faced withering criticism from President Donald Trump, U.S. legislators from affected states, and the UAW. Trump has focused on a plant in Lordstown, Ohio, that's slated to stop making compact cars on March 1. He has promised to return factory jobs to the U.S. and Ohio, a key state in his 2020 re-election campaign.

GM is cutting six car models as buyers have dramatically shifted their preferences to SUVs and trucks, which will account for about 70 percent of new-vehicle sales this year.

The automaker also wants to close an assembly plant in Detroit and transmission plants in Warren, Michigan, and near Baltimore. About 3,300 union jobs would be lost, but GM says many can transfer to 2,700 openings at other factories.

GM now makes the Chevrolet Equinox and GMC Terrain small SUVs in Mexico, as well as full-size GMC and Chevrolet pickup trucks. It also makes the Blazer SUV there, as well as the hatchback version of the Chevrolet Cruze compact car. The Equinox also is made in Ingersoll, Ontario, and the Cruze sedan is made in Lordstown, Ohio.

GM also builds full-size pickups at several U.S. factories.

The company says production at the Ingersoll plant alone is about equal to the company's retail sales in Canada.

 

Protests will continue until
GM decides to keep Oshawa
plant open, union head vows

Unifor says company violating collective agreement signed in 2016


Local 584 Plant Chair Gary Rumboldt and Trustee Ed Valdez
occupy GM Headquarters on January 23, 2019

Jenn Cowie, who has worked on the line at GM for 16 years, says she feel betrayed by the company, and says its decision to close the plant is about corporate greed. (CBC)

Muriel Draaisma
Jan 24, 2019
 CBC News

Protests by workers against General Motors will continue in Ontario until the company reverses its decision to close a plant in Oshawa later this year, Unifor national president Jerry Dias says.

Speaking to dozens of employees outside GM headquarters in Oshawa, Dias said he is not calling for an "outright boycott" of GM vehicles, but said Unifor members are angry at the impending closure of the Oshawa Assembly Plant slated for the end of 2019. 

"We are not going to stop until you reverse this outrageous decision. You can't do to this our members, our community, our country," he told the crowd in the rain on Wednesday.

Dias said workers are also upset that GM is refusing to honour a collective agreement, signed in 2016, that was to cover a period until September 2020. According to the union, the agreement stipulated that there would be no closure of the plant while the agreement was in effect.

Dias addressed workers outside entrances to GM headquarters at a protest that began early Wednesday. Workers blocked road access into the facility and placed signs and placards in the snow. The protest is expected to continue into the evening.

He acknowledged that GM had claimed the protest was illegal, but he said what the company has done is illegal because it accepted $11 billion in financial aid from the federal and Ontario governments, then decided to close the plant. 

"Based on General Motors' commitment in 2016, our young members went out and bought homes, bought new cars, started families. People made decisions based on General Motors' commitment. And General Motors does not have the right to go against the written word," he said.

"If we want to talk about what's illegal, we should also talk about what's immoral."

Dias said GM, which he accused of lying, will be known as "Greedy Motors" until it decides to keep the the plant open.

GM has steadfastly refused to reconsider its decision to close the plant.

Earlier, Colin James, president of Unifor Local 222, which represents workers at the plant, said the union staged the protest in an attempt to get the company's attention.

"We plan on staying here as long as it takes. We are trying to send a clear message to GM that the decision that they have made they cannot justify. It's an award-winning plant," he said.

"I believe today we will get some attention. We're increasing awareness that here's a company that's making record profits. And now they're turning their back on Canadians."

James said workers have been preventing vehicles from entering its headquarters, but the protest has been legal. 

Canadians have sent messages of support

The union has set up fire barrels and canopies to keep workers at the protest warm. Many protesters are also wearing rain coats.

James said the union has received letters, phone calls and email messages of support from hundreds of Canadians.

"Canadians are sending a message that: 'If you want to sell here, you need to build here.'"

Jenn Cowie, a line worker at GM in Oshawa for 16 years, said she attended the protest because she feels betrayed by the company. 

"We are getting out the message that we are not going away. People understand that this is all due to corporate greed," she said.

"I don't know what my next steps are, but as far as right now, we are sticking together. These are good paying jobs that are in our community. We've earned our jobs here."

As for the plant, located a distance away, it was running on Wednesday and the union said it asked its members to continue to work.

GM Canada says protest not affecting work

For its part, GM Canada said in a tweet that it considers the protest illegal and it does not condone blocking of road access, which it said affects third parties. It added that the protest is not affecting work because the company has alternate plans.

GM has rejected all union proposals to keep the plant open past 2019. The plant, about 60 kilometres east of Toronto, employs more than 2,500 hourly workers.

The company announced in November that work at the plant would end by December 2019, a decision that Unifor has challenged.

 

 

Lincoln Aviator wins top Readers'
Choice award at auto show

Best of Show: Lincoln Aviator (Photo: Robin Buckson, The Detroit News)


Breana Noble,
The Detroit News
Jan 23, 2019

The 2020 Lincoln Aviator was voted best-in-show in The Detroit News’ annual Readers' Choice Awards at the Detroit auto show.

One-hundred judges selected from the public chose for the top honor the luxurious Aviator, which debuted last fall at the Los Angeles Auto Show. The 2019 Lincoln Navigator, which earned the top Readers' Choice Award last year, won this year for top road-trip ride.

Parent company Ford Motor Co. also took the prize for best dream machine with its Ford Mustang GT 500, the most powerful pony car ever. It premiered at the Detroit auto show last week.

Meanwhile, General Motors Co. took two top places. The most amazing mobility vehicle award went, ironically, to a vehicle without much of a future: the Cadillac CT6. Once the brand's signature sedan, the CT6 is expected to cease production when the Detroit-Hamtramck Assembly plant idles indefinitely this summer.

The all-electric Chevrolet Bolt was voted most eco-friendly.

From Fiat Chrysler Automobiles, the Dodge Ram 1500 scored for coolest technology with more than 100 standard and available safety and security features. The long-awaited Jeep midsize pickup, the Gladiator, was voted baddest off-road vehicle.

Other winners include:

  • Best family-fun finder: Kia Telluride
  • Best future concept: Infiniti QX Inspiration
  • Most for your money: Hyundai Sonata

The announcements were made Tuesday at a Detroit Economic Club luncheon at the auto show.

 

 

Canada's vast pension fund is
sticking with China even
as political tensions mount

Natasha Turak
Reuters
Jan 22, 2019

 Investment strategies involving China are coming under scrutiny amid political and security-related conflicts between Beijing and major Western economies, as well as a predicted growth slowdown for the world's second-largest economy.

But Canada's massive pension fund, among the world's top 10 in terms of size, is sticking to plans to expand its holdings there.

Mark Machin, president and chief executive of Canada's Pension Plan Investment Board (CPPIB), sees the country's potential to diversify his portfolio as outweighing any shorter-term economic setbacks.

"China is today the second-largest economy in the world, the second-largest equity market in the world, the third-largest bond market in world, and we have the ability to diversify into it," he told CNBC at the World Economic Forum in Davos.

"So it's more of a diversification call than a market call for the next few weeks or months ... It's much longer-term and it's about diversification."

China's growth outlook has been dampened by weakened domestic demand and the trade war with Washington that's hit exports. A recent Reuters poll found that the country's growth is expected to slow to 6.3 percent this year from an expected 6.6 percent in 2018, which would be the lowest in 29 years. That figure was 6.9 percent in 2017.

The CPPIB, with $280 billion in assets under management as of last summer, plans to more than double its assets allocated to China by 2025 from a current 7.6 percent of its portfolio to up to 20 percent, it announced last August.

Huawei controversies

Machin admitted to the rising difficulties brought about by tensions between the U.S. and China that have spilled over to Canada. In December, Canadian authorities arrested Huawei Technologies Co. Chief Financial Officer Meng Wanzhou at the request of the U.S., as Washington pursues the executive's extradition on charges of fraud and sanctions evasion. Since then, 13 Canadian nationals have been detained in China, authorities in Ottawa said at the start of January.

Canada is also weighing banning Huawei equipment from use in the rollout of Canada's 5G next-generation wireless network on the basis of national security concerns, which Huawei denies. For Machin, these disputes — but in particular the U.S.-China trade spat — are not helpful.

"One of the things we're seeing is not just the first-order impact of that tension but the second, third, fourth order and it's rippling through the world and everything is slowing down now," Machin lamented.

On Monday, the International Monetary Fund downgraded its global growth forecast to the slowest pace in three years, citing slowdowns in Europe but highlighting the trade war and uncertainty over Brexit. The IMF's World Economic Outlook lowered growth estimates for 2019 by 0.2 percent to 3.5 percent, the second downward revision in three months.

"It's not helpful to have these tensions going on and I hope they are quickly resolved and we go on with normal trade relations, normal investment relations," Machin said.


 

Ford sued for sexual,
racial harassment at
Dearborn Truck Plant


Ian Thibodeau,
The Detroit News
Jan 21, 2019

An employee at Ford's Dearborn Truck Plant is suing the company on claims her male supervisor groped her, sexually harassed her and showed her photos of himself having sex with other women who work at the plant.

DeAnna Johnson, 54, alleges the Dearborn Truck Plant supervisor on a daily basis would ask her to show him her breasts while he was teaching Johnson her job as production supervisor and assessing her performance.

A Ford Motor Co. spokeswoman said Thursday the supervisor accused of harassment was fired in December after an internal review. 

The supervisor also called Johnson, who is African-American, "'chocolate jolly rancher,'" according to a lawsuit filed Thursday in U.S. District Court in Detroit. "When she asked him what that meant, he responded that she was a chocolate treat" that he wanted to have sex with. 

“Ford does not tolerate sexual harassment or discrimination," Ford spokeswoman Kelli Felker said in a statement. "We take those claims very seriously and investigate them thoroughly. While we have not received this lawsuit, we are aware of the allegations. The plaintiff filed a Human Resources complaint in November 2018. We launched an investigation, immediately suspended the employee that was the subject of the complaint, then fired him in December. Ford also interviewed every supervisor who the plaintiff claims had knowledge of her allegations prior to her Human Resources complaint and found that the only supervisor to whom she complained immediately referred her complaint to Human Resources.”

Both the plaintiff and the supervisor who was fired were salaried employees, according to Ford.

The lawsuit was filed just more than a year after CEO Jim Hackett traveled to the automaker's plants in Chicago to address allegations of sexual harassment made there. The New York Times reported in late 2017 that women at the Chicago plants said their complaints about sexual harassment were met with hostility, and that management’s efforts to correct the problem proved ineffective.

Following that report, Hackett wrote an open letter to Ford employees, and the automaker played a three-minute video on a loop in U.S. plants denouncing sexual harassment. 

Hackett and Ford publicly and repeatedly denounced the actions at the Chicago plants. The automaker said a year ago it would pay $10 million to settle the charges there.

Johnson's claims about her experience at the Dearborn Truck Plant are similar in nature to those reported at the Chicago facilities. 

The supervisor, according to the lawsuit, often stuck his cellphone in Johnson’s face, to show her a picture of him having sex. Johnson "recognized some of the women in the pictures as (his) subordinates — women who worked the line and reported to him. Each time, (the supervisor) would comment 'oops, wrong picture' or something similar," the lawsuit alleges.

The supervisor allegedly told Johnson he wanted to have sex with her because he did not yet have a black woman in his "collection," according to the lawsuit. Johnson's attorney, Carol Laughbaum, told The Detroit News the supervisor is white.

The suit also says the supervisor sent Johnson "numerous sexually suggestive inappropriate texts," and sent her a photo of "himself in his underwear, and pictures of his genitals."

Johnson in October reported the supervisor's actions to managers. The suit alleges that the manager she first reported the incidents to told Johnson that she should "just" have sex with the supervisor "and get it over with."

When higher-level managers did report the incidents, the lawsuit says Johnson was told by Ford human resources department to turn over her cellphone so the company could collect data from it.

When Johnson asked why Ford was not going through the supervisor's phone, the suit alleges the company said he refused to give it up. Johnson has since been on medical leave, according to the lawsuit. It says she has been diagnosed with post-traumatic stress disorder.

Johnson is suing Ford for one count of allowing a sexually hostile work environment in violation of Michigan’s Elliott-Larsen Civil Rights Act; one count of racial harassment; and one count of sexual assault and battery. Johnson is demanding she be compensated for lost wages while on leave in addition to other damages.

The United Auto Workers union released a statement Friday in response to the suit.

"No UAW member should ever feel the sting of racism in the workplace," it said. "The UAW has long believed as part of our core values that discrimination has no place in the workplace. We have created a series of avenues that allow our members to address discrimination, including through our civil rights committees, UAW Constitutional procedures, the grievance process and other workplace mechanisms.

"But the fact is, even in 2018, there are still members who are touched by unacceptable behavior. We take this seriously and our goal is to make all members feel safe and welcome in their workplace, always."

 

 

Ford rethinks Level 3 autonomy

Michael Martinez
Automotive News

Jan 20, 2019

DETROIT — Ford Motor Co. is shifting its approach to autonomous-vehicle technology.

In 2016, Ford said it would largely pass over Level 3 autonomy and instead focus on Level 4 — vehicles that don't require human control — while continuing to develop Level 2 driver-assist features such as blind-spot monitoring and lane-keeping systems. (Automation technology is categorized on the SAE International spectrum ranging from Level 0 to Level 5.)

At the time, Ford executives said they did not know how to responsibly manage the transfer of control from machine to driver that happens with Level 3 systems.

"We abandoned the stepping-stone approach of driver-assist technologies and decided we'd take the full leap to deliver a fully autonomous Level 4-capable vehicle," Raj Nair, then Ford's president of North America, said at an August 2016 event detailing Ford's autonomous business plan.

At the time, executives said the approach was unique in the industry and would set Ford apart from rivals including General Motors.

Since then, Google's Waymo unit also has said it aims to skip Level 3 because of safety risks, and Audi last year said it wouldn't enable Level 3 features on its A8 sedan for the U.S.

Now, Ford is embracing the stepping-stone approach, with the aid of cameras and other systems that can ensure drivers are paying attention at the wheel.

"Taking steps to get there as opposed to a big bang is more practical," Marcy Klevorn, Ford's president of mobility, told Automotive News on the sidelines of the Detroit auto show last week. "I think it allows us to provide autonomy in step functions to get people used to it. Acceptance is going to be a big deal; this is totally a different way to move."

Ford still plans to deploy Level 4 commercial vehicles at scale in 2021. In the meantime, it's offering more advanced semi-autonomous systems that can take control of the wheel and pedals for very short periods of time.

Much like Cadillac's Super Cruise system uses retinal detection to make sure drivers are paying attention, Ford uses technology that can ensure drivers take control at a moment's notice.

That's an important feature to offer as wary consumers first experience the technology, Klevorn said.

"It's more just getting people used to the idea there's increased levels of autonomy, gaining that acceptance and providing functionality now," she said.

"If you go right to full autonomy, the acceptance curve will be very steep, and you won't have as much to learn about how humans interact with autonomy. If you just take that leap, you miss out on all those learnings."

Ford over the past few years has tested autonomous pizza- and grocery-delivery services and conducted studies on how autonomous vehicles might communicate with pedestrians through blinking lights and noises.

Some industry analysts believe Ford is behind rivals such as GM, Waymo and others, but Ford executives argue they're taking a more thoughtful approach.

"There's been a lot of hype and talk," Klevorn said. "But I think 2019 is the year of getting real, delivering and executing for a lot of us."

 

UAW workers rally downtown to
urge auto execs to 'invest in us'


Mark Hicks,
The Detroit News
Jan 19, 2019

Detroit — Hundreds of United Auto Workers members impacted by impending idling of General Motors plants gathered outside a black tie event at Cobo Center Friday to demand automotive executives "invest in us."

Chanting and carrying signs as they led a candlelight procession from Hart Plaza to the site of the North American International Auto Show Charity Preview, demonstrators aimed to highlight the automaker's decision to idle several Michigan, Maryland and Ohio plants.

“They need to invest in us and … come out of their ivory towers and have a conversation with us about our jobs,” Mike Plater, plant chairperson with UAW Local 22, Detroit-Hamtramck Assembly, told the crowd. “That’s what we want. That’s what we deserve.”

His plant is among the four in the United States that GM has targeted for idling this year, along with Warren Transmission, Baltimore Operations and Lordstown Assembly in northeast Ohio. 

The company is planning to halt production indefinitely as slow-selling products built there are discontinued.

It's part of a larger restructuring plan designed to save the automaker some $6 billion by 2020.

However, union officials in the U.S. and Canada have criticized the company pushing to invest in its Mexican manufacturing facilities while shutting down union-represented facilities.

At the vigil Friday, members repeatedly blasted the moves as harming employees while losing many supplier jobs and hurting nearby businesses.

 “Why aren’t they standing up and being good corporate citizens and supporting the communities that supported them?” said Dave Green, UAW Local 1112 President, Lordstown Assembly.

Others noted workers made many concessions when GM faced a financial crisis nearly a decade ago but expected returns when conditions improved.

“GM makes profits, the shareholders make profits, and it’s happening at the expense of our members and our workers,” said Chuck Browning, UAW Region 1A Director. 

Reached for comment Friday, GM spokeswoman Kim Carpenter said the company respects "everyone’s right to demonstrate and express their points of view."

"Our focus remains on the employees and the impacted communities," she told The Detroit News. "We have job opportunities for virtually every hourly employee at the impacted plants — anyone who wants a job will have a job.”

Unifor Local 222 Oshawa, Ontario, Canada plant worker Ron Van De Walker, of Oshawa, joins U.S. UAW workers as he and several co-workers made the 4.5 hour drive from Canada to participate in the Hart Plaza candlelight vigil. Todd McInturf, The Detroit News

Before the gathering downtown, Gov. Gretchen Whitmer supported the workers at the union’s Solidarity House in east Detroit.

“We are ready to compete with the world, but we need to make sure investments stay here in our state,” she told them. “…You work hard every single day to produce the best product around. You just need to make sure that the company has the same commitment to you that you’ve shown to them.”

Her lieutenant governor, Garlin Gilchrist II, also spoke out on the impact at Hart Plaza.

“For every person who’s not going to work on the line, that’s another person not going to the gas station,” he said. “That’s another person not going to get a cup of coffee. That’s another person not going to grab a lunch. That’s another person not going to buy milk or orange juice and bread for their babies.”

The chance to speak out on the issue drew supporters such as Ernestine Howse of Detroit, whose father was a UAW worker.

“It’s very important,” she said. “There would be no middle class without the union.”

She joined the marchers who hoisted signs and marched to Cobo, where they converged with other demonstrators supporting a “Green New Deal” that would create more jobs in Detroit.

The protesters swarmed near the entrance as charity preview attendees arrived.

Also in the crowd was U.S. Rep. Rashida Tlaib, D-Detroit, who criticized GM.

"You’re not going to take everything we gave you and go to Mexico," she said in a video posted to her Facebook page. "We’re here to demand justice. We’re here to say that workers matter, that human beings matter. We need a Green New Deal. We need accountability. … Enough of all this unbelievable corporate greed that puts people last."

GM has said it had 2,700 transfer opportunities for the 2,800 UAW employees affected. Last week, officials said 1,500 workers have volunteered to transfer. About 700 are already headed to new jobs in Michigan and Tennessee.

UAW Region 1 Director Frank Stuglin argued GM is only concerned with its bottom line.

“They’re just looking at numbers. I’m looking at families,” he said at Hart Plaza. “… Families are going to be split up.”

 

The 2020 Ford Mustang
Shelby GT500 is the
most-powerful Ford ever

 


Ford expects better
financial results in 2019


Ian Thibodeau,
Jan 16, 2019
The Detroit News

Ford Motor Co. CEO Jim Hackett said Wednesday that the behind-the-scenes work he and his executive team have been doing in the 19 months since he was appointed to lead the company should start to pay off this year.

Ford expects financial results in 2019 should be an improvement over the year prior. The automaker reported it made 92 cents per share in 2018 — down from $1.90 per share in 2017.

The automaker presented the 2019 outlook during the Detroit auto show. Ford's top executives explained the expectations to investors at the 2019 Deutsche Bank Global Auto Industry Conference on Wednesday in Detroit.

Hackett, chief financial officer Bob Shanks and president of global markets Jim Farley said their plan took effect in 2018, and will begin to boost the bottom line in 2019 as cost-cutting and restructuring continues.

Ford is in the middle of a sweeping global restructuring as it readies for a new chapter in the automotive industry. Under Hackett, Ford's senior leadership is pushing to trim $25.5 billion in operating costs over the next five years and spend $11 billion to shake up failing businesses in Europe, China and South America, and better position the automaker's North American business for continued profitability through the next decade.

"We're really confident in our plan to redesign our business," Hackett said. "We are moving. We are moving right now. We have clear direction, focus, a sense of urgency."

The automaker's preliminary 2018 results are line with the full-year guidance the company adjusted mid-year last year due to a worse-than-expected performance in China. Ford expects to have finished 2018 with an adjusted-earnings per share of $1.30, as well as $23.1 billion in cash and liquidity of $34.2 billion. The automaker declared a first-quarter regular dividend of 15 cents per share.

Ford stock has fallen from around $13 at the beginning of 2018 to around $9 now. Shares slid around 2 percent in pre-market trading Wednesday.

But Ford officials stressed a positive outlook for 2019 despite expected significant trade and tax headwinds.Farley told investors about Ford's product gambit planned over the next 24 months in North America, during which it will refresh 75 percent of its product portfolio as it shifts spending to devote 96 percent of its product capital to trucks and SUVs.

He outlined the company's plan to capitalize globally on its strong commercial vehicle business. Ford's global commercial business generates $72 billion in revenue and roughly $10 billion in earnings before interest and taxes. It operates at a 14 percent margin; by comparison, Ford is pushing to get its entire North American business back to a 10 percent operating margin. In Europe, Ford is targeting 6 percent.

Farley said Ford is moving to extend its lead in the pickup truck market in the U.S. The automaker has a hybrid F-150 coming to market. Later this month, Ford will debut an all-new Super Duty pickup, he said.

Officials announced last week announced plans to revive its unprofitable European business by cutting salaried and hourly workers, ending production at plants in France and Germany, eliminating less-profitable vehicles like the C-Max from the lineup there, and possibly exiting a Russian joint venture. Farley will outline the automaker's plan to focus on commercial vehicles there while it corrects the rest of the business.

Ford on Tuesday said it had entered an agreement with Germany's Volkswagen AG to partner on commercial vans and midsize pickups to be sold outside of North America. The partnership is aimed in part at boosting Ford's European business.

In China, the automaker plans to debut 10 new Ford and Lincoln vehicles this year, contributing to a total of 30 new products by 2021. Meantime, the automaker plans to reduce administrative headcount by 20 percent in South America this year, according to a news release.

Meantime, Shanks said in a statement that despite rising commodity costs, unfavorable exchange rates and on-going trade disputes, Ford will have positive operating results. The 15 cents per share dividend will be payable March 1 to shareholders of record at the close of business Jan. 31.

Shanks said 2018 was an important year for the company. "We made many important strategic choices, and we began to take actions that will fundamentally redesign our business. 2019 is about action. Implementation. A year where our thinking about the future of Ford, the fundamental design of the business, our capital allocation choices, our fitness, who we choose to partner with and why become increasingly clear."

The finance chief expects revenue, earnings and operating cash flow to improve on a year-over-year basis in 2019. At this time last year, Shanks and Hackett provided a grim outlook for 2018.

Ford will report fourth-quarter 2018 and full-year earnings results Jan. 23. 

 

Ford, VW link-up looms
over Detroit auto show

Ian Thibodeau,
The Detroit News
Jan 15, 2019

Detroit — Ford Motor Co. and Volkswagen AG leadership Tuesday morning will offer some details about the companies' ongoing partnership discussions.

The automakers are expected to at least announce official plans to partner on joint production of commercial pickup trucks, The Detroit News reported Friday. Ford officials in the last week have said partnering in Europe could be a boon to Ford's commercial vehicle business there.

VW officials have said Ford's U.S. production facilities could be a valuable asset for the German automaker that's trying to grow U.S. market share.

"The talks are going really well," Ford Executive Chairman Bill Ford said Monday at the Detroit auto show.

Ford CEO Jim Hackett kept things close to the vest Monday at the auto show, saying "there's nothing to report today." 

Hackett, Herbert Diess, VW CEO, Jim Farley, Ford president of global markets and Thomas Sedran, VW CEO of commercial vehicles, will detail the plans Tuesday morning on a conference call.

The automakers have been in talks since at least June regarding a partnership on commercial vehicles. Those discussions expanded. The companies are still negotiating a partnership along with Argo AI, the autonomous driving technology company in which Ford has an ownership stake, to partner on autonomous vehicles. 

The automakers have also talked about partnering on electric vehicles. VW announced plans to invest more than $800 million into a second plant in Chattanooga, Tennessee, to build electric vehicles. The facility is a part of VW's e-mobility future in the United States and will create 1,000 new jobs. The first electric vehicles are expected to roll out in 2022 from VW. 

Ford, meantime, is expanding its own electric vehicle offerings. The automaker is planning to offer 24 hybrid variants of every new vehicle it introduces moving forward. The automaker will also debut 16 all-new full-battery electric vehicles in coming years, the first of which is a "Mustang-inspired" electric vehicle that's Hackett's brainchild.

The automakers have not publicly commented on what an EV partnership would look like. It's also unclear if a commercial vehicle partnership would bring the Ford-VW pickup to the U.S. commercial market as well.

Joe Hinrichs, Ford president of global operations, told The Detroit News on Monday that Ford is in a transition period with powertrains. The industry is moving from combustion engines to a greater mix of electric and hybrid vehicles.

"It's been slower than people predicted 10 years ago or five years ago, but it's coming," Hinrichs said. "We know it's coming. We think that it's important for the customer use cases that we offer them choices."

Ford and VW are expected to continue negotiating pieces of the partnership after the companies offer some clarification on the status of things Tuesday.

The automakers are not merging, both Ford and VW officials have said. That has never been part of the talks.

The automakers signed a memorandum of understanding last summer to look into partnering on commercial vehicles, Ford's best-seller in Europe. Pickups are a weak spot for VW, which vies annually to be the global leader in vehicle sales. 

Diess said after a White House meeting in December that he might use Ford plant capacity in the U.S. to build cars. Ford said then the discussions were progressing well.

 

Ford sold 1.1 million F-Series pickups last year


Ian Thibodeau,
The Detroit News
Jan 14, 2019

Ford Motor Co. sold nearly 1.1 million F-Series vehicles globally last year — lined end-to-end, the vehicles would stretch from Dearborn to County Cork, Ireland, the Ford family's ancestral home.

The Dearborn-based automaker sold most of those vehicles in the U.S. last year. Ford reported in early January it had moved 909,330 F-Series in 2018, which was a 1.4 percent increase over the year prior.

Ford primarily sells its pickups outside of the U.S. in Canada, the Middle East and in China, spokesman Mike Levine said Friday. The automaker sells the behemoth Raptor off-roader in China.

The more-than 1 million pickups sold last year would have generated $50 billion, using the $46,700 U.S. average transaction price for those vehicles. Lined bumper-to-bumper, the trucks would stretch more than 4,000 miles, enough to get from Dearborn to Las Vegas and back.

Analysts and investors have pointed out in 2018 that Ford's F-Series brand is the most valuable piece of the company. Sales from those vehicles generated more estimated revenue last year than Best Buy. 

Ford's success in the pickup market has sparked the first leg of a partnership with Germany's Volkswagen AG. The automakers plan to next week announce details of a commercial truck partnership.

F-Series trucks are built at Ford's Kentucky Truck Plant, Kansas City Assembly Plant, Ohio Assembly Plant and Dearborn Truck Plant.

 

Ford to cut thousands of
jobs in turnaround plan

BBC News
Jan 13, 2019

It is expected to lead to thousands of job losses across Europe, including the UK, although cuts at its UK factories are not thought to be imminent.

But Ford Europe boss Steven Armstrong said should the UK leave the EU without a negotiated deal, a further review of UK operations would take place.

Ford is now going to talk to unions about measures to reduce costs.

This includes focusing on more profitable models and exiting less profitable markets, to concentrate more in future on electric and hybrid technology.

The firm will also expand its commercial vehicle business, which will be one of three new divisions being created, along with passenger vehicles and imported vehicles.

Ford hopes the changes will enable it to achieve a 6% operating margin in Europe.

The UK's biggest union Unite said it was working closely with Ford to safeguard jobs in the UK and look after the interests of employees.

The union also said it expected the impact of cuts on jobs in the UK to be limited.

'Wrong direction'

Speaking to reporters after the announcement, Mr Armstrong said the firm "needed to address the parts of the business that are unprofitable".

But he said the move had not been forced upon the firm by the UK vote to leave the European Union on 29 March.

"This is not a consequence of the Brexit situation," he said. "This is not a one or two-year issue."

He added: "If Brexit goes in the wrong direction and we have a hard Brexit, we would need to look again about what we could do to mitigate the impact of that [in the UK]."

He said potential closure of plants would "not be off the table".

Engine uncertainty

Ford says there will be a "reduction of surplus labour" across all its business functions.

It has not released any figures, as discussions with unions are continuing, but that it could be in "thousands".

Ford operates two engine factories in the UK, at Dagenham, east of London, and Bridgend in Wales, as well as a joint venture with the gearbox manufacturer Getrag on Merseyside.

The announcement is likely to renew concerns about the long-term future of the Bridgend plant in particular. It is already due to lose a major contract to build engines for Jaguar Land Rover in 2020.

Profits at Ford of Europe fell 82% last year, in part due to the fall in the value of the pound as a result of uncertainty over Brexit.

It is understood that while this is a preoccupation for the company, it is one of many factors affecting the business, which has been underperforming for years.

The BBC understands that Ford's Dunton Technical Centre in Essex could potentially benefit from new investment in the commercial vehicles business.

Ford of Europe has 54,000 employees, with 13,000 in the UK. As well as the UK engine plants, it has other operations in Germany, France, Turkey, Spain, Russia, Romania, and Belgium.

As part of the shake-up the firm says it will stop manufacturing automatic transmissions in Bordeaux, France, in August, and will review its operations in Russia,

Mr Armstrong also said the company was in negotiations with staff representatives about potential job cuts at its Saarlouis plant in Germany, where 6,190 staff assemble cars, as the firm considers discontinuing production of its Ford C-Max model.

Diesel slump

The news comes as rival Jaguar Land Rover (JLR) is set to announce it is cutting up to 5,000 jobs from its 40,000-strong UK workforce.

Management, marketing and administrative roles are expected to be hardest hit, but some production staff may also be affected.

The layoffs are part of a £2.5bn cost-cutting plan amid what industry insiders have called a "perfect storm".

They mean a downturn in Chinese sales, a slump in diesel sales and concerns about UK competitiveness post-Brexit.

 

 

FCA to pay nearly $800M
in emissions cheating case

Keith Laing,
The Detroit News
Jan 11, 2019

Washington — Fiat Chrysler Automobiles NV will pay nearly $800 million to settle allegations from federal regulators that the company used software on about 104,000 diesel-powered pickups and SUVs that is similar to “defeat devices” that were used by Volkswagen AG to cheat U.S. emissions-testing, a person familiar with the terms of the settlement told The Detroit News on Wednesday.

The settlement requires the Italian-American carmaker to pay $280 million to compensate drivers of Jeep Grand Cherokees and Dodge Ram 1500 pickups from the 2014-16 model years with 3-liter V-6 diesel engines.

The company also will pay $305 million in civil penalties to the U.S. Department of Justice, Environmental Protection Agency and California Air Resources Board and at least $72 million to states whose attorneys general had sued over the alleged cheating.

The automaker is likely to face additional payouts to other federal agencies and states that filed separate lawsuits, bringing total payments to as much as almost $800 million, according to the source. 

Drivers of the affected models could receive as much as $2,800 each under the settlement. 

FCA will not be required to admit any wrongdoing as part of the settlement and the company is not going to required to buy back any of the affected vehicles. 

The EPA and DOJ did not immediately respond to requests for comment Wednesday night from The Detroit News. 

Federal regulators have alleged that FCA did not disclose at least eight auxiliary emission control devices on the Jeeps and pickups covered under the settlement. Automakers can legally deactivate a vehicle’s emission control system under certain conditions, but regulators require the disclosures when companies apply for certificates that are required to sell cars in the U.S.

FCA has contended that its vehicles were fully in compliance with regulations, even as it worked toward a settlement.

FCA took pains to note the differences between its case and that of Volkswagen AG.

Six of the German automaker's present and former executives were indicted, and VW itself was charged with three criminal felony counts for what regulators called a 10-year conspiracy to rig hundreds of thousands of diesel cars to evade U.S. emission standards.

Volkswagen was forced to pay $2.8 billion in criminal fines and $1.5 billion in civil penalties related to the fraud.

That’s in addition to a $14.7 billion settlement the company reached last year with the EPA that calls for Volkswagen to spend $10 billion to either buy back or repair about 475,000 2-liter diesel cars sold between 2009 and 2015; the company also was required to contribute $4.7 billion to federal efforts to reduce pollution.

FCA has noted that its affected vehicles require only a software fix, unlike Volkswagen, which had to provide new hardware to satisfy federal regulators. 

FCA warned investors in the third quarter of 2018 of a possible $810 million (700-million euros) charge related to the diesel investigation. The company initially feared it could face fines of up to $4.6 billion

 

Ford cancels Mexico
plant, expands U.S.
factory and adds
700 jobs


Nathan Bomey
USA TODAY
January 7, 2019

Ford Motor announced Tuesday that it would cancel plans for a $1.6 billion Mexico plant and launch a Michigan expansion in a move that may be viewed as a capitulation to Donald Trump.

Ford CEO Mark Fields said the company would spend $700 million and add 700 jobs to "transform and expand" its Flat Rock, Mich. manufacturing plant to make autonomous and electric vehicles.

"Make no mistake about it — Ford is a global automaker but our home is right here in the United States," Fields said at a press conference.

The move marks a sharp reversal for Ford, which has defended its production in Mexico even as Trump has assailed the company for expanding there.

"This is a vote of confidence for President-elect Trump and some of the policies he may be pursuing," Fields said.

To be sure, Ford acknowledged that it would still move production of the next-generation Focus sedan to Mexico, as previously announced. But it will be built at an existing plant in Hermosillo, Mexico, not at a new facility.

President-elect Donald Trump is going after General Motors giving them an ultimatum when it comes to manufacturing across the border. Veuer's Nick Cardona tells us what the President-elect had to say. Buzz60

The United Auto Workers hailed the decision.

"We've seen our jobs go overseas," UAW Vice President Jimmy Settles said. "It's evident today that Ford is rewarding us for our hard work."

Others will view the move as a bid to satisfy Trump, who has cited Ford's Mexico expansion as a key example of how the North American Free Trade Agreement has weakened American manufacturing.

Ford Executive Chairman Bill Ford called Trump this morning to inform the president-elect of the decision, and Fields called incoming Vice President Mike Pence.

"Automakers are facing a situation where they have to consider the political consequences" of all their decisions, AutoTrader.com analyst Michelle Krebs said.

Ford's expansion will convert 700 temporary jobs at the Michigan plant into permanent positions, adding to an existing hourly staff of about 3,600. Fields said the automaker will add about 200 jobs at its plant in Hermosillo, Mexico, to make the Focus but did not say how much it would invest.

The Michigan expansion plans are part of a broader $4.5 billion investment in electric vehicles and hybrids, including 13 new models over the next five years.

Those vehicles include a small, electric sport-utility vehicle with 300 miles of battery range, which will be exported overseas, and a "high-volume autonomous vehicle designed for commercial ride-hailing or ride-sharing," Ford said in a statement.

The company will also manufacture a hybrid version of the F-150 pickup truck by 2020 at the Dearborn, Mich., plant, where the F-series lineup is currently manufactured.

 

Ford adds 149,652
vehicles in Canada to
Takata airbag recall

Automotive News
Jan  6, 2019

DETROIT -- Ford Motor Co. is expanding its Takata airbag inflator recall for the fourth time, adding about 953,000 vehicles to the list.

The callback announced on Friday involves passenger-side inflators on 782,384 vehicles in the United States and 149,652 in Canada. Affected vehicles are the 2010 Ford Edge and Lincoln MKX; the 2010-11 Ford Ranger; 2010-12 Ford Fusion, Lincoln MKZ and Mercury Milan; and 2010-14 Ford Mustang.

Faulty Takata airbag inflators may explode and shoot shrapnel toward vehicle occupants, potentially resulting in injury or death. An estimated 23 deaths — including two in Ford vehicles — and more than 290 injuries worldwide have been linked to the defective inflators. Ford agreed to a US$299 million legal settlement last year for its portion of the airbag defect liability.

Six other automakers previously agreed to similar settlements worth over US$1.2 billion combined: Honda Motor Co.; Toyota Motor Corp.; Nissan Motor Co.; Mazda Motor Corp.; Subaru Corp. and BMW AG.

Ford said it is unaware of any injuries associated with the passenger-side frontal inflators covered in the latest expanded safety recall.

The ongoing safety issue has be named the largest auto industry safety recall in history, involving about 100 million inflators among 19 major automakers.

Front seat recall

Ford also issued a separate recall Friday for certain 2019 Ford EcoSport vehicles in North America, about 63 in the U.S. and 13 in Canada.

Insufficient welding between the side member and A-bracket on the front seat back may reduce its strength and can potentially increase the risk of injury in a crash. Dealerships will replace front seats on affected vehicles with new seats.

Ford is unaware of any accidents or injuries resulting from this front seat recall.

 

 

Auto sales beat
expectations for
2018, but 2019
doesn't look as good


Ian Thibodeau and Nora Naughton,
The Detroit News
Jan 4, 2019

Automakers beat U.S. sales expectations in 2018 thanks to tax breaks, eager buyers and strong fleet sales, but experts and analysts expect 2019 won't bring such favorable results.

Rising interest rates and vehicle prices could create more headwinds for Detroit's Big Three, specifically, as the automakers move to reinvent their business models as well as their product lineups to better situate themselves for the next generation of the auto industry.

Fiat Chrysler Automobiles NV reported Thursday the best sales increase of all the Detroit carmakers. It reported Thursday that it moved more than 2.2 million vehicles last year, a 9 percent increase over the prior year, though that was still fewer total vehicles than Ford Motor Co. or General Motors Co. 

Ford and GM both saw single-digit sales declines. GM sold 2,954,037 vehicles in 2018, down 1.6 percent from 2017. Ford sales slid 3.5 percent in 2018, with 2.5 million vehicles sold.

Overall U.S. vehicle sales totaled 17.3 million in 2018, a 0.4 percent increase from the 17.1 million sold in 2017.  The year 2017 was the first since 2009 that new vehicle sales declined. 

"The picture doesn't look quite as rosy for 2019," said Jessica Caldwell, analyst with California-based Edmunds. "While the economy is still relatively strong, rising interest rates and vehicle prices could force many buyers into the used market, or even price them out of buying a vehicle completely. If the economy weakens or tariffs push prices even higher, things could go south for the auto industry very quickly."

That's leading some on Wall Street to ring alarm bells. Adam Jonas, equity analyst with Morgan Stanley, on Thursday said in a note that 2019 will mark the first global auto sales decline since 2009. He reiterated a cautious view on U.S. auto stocks.

"In addition to lack of volume growth, we believe earnings are at risk from higher input costs, rising rates, rising (research and development) expense, and tariff-related frictional costs," Jonas wrote.

Meantime, GM, Ford and Fiat Chrysler will have to contend with U.S. buyers' continued exodus from the sedan market, according to Karl Brauer, analyst with Cox Automotive.

"Everything from tariffs to material costs to the ongoing shift from cars to trucks will drive transaction prices higher," Brauer said. "Low gas prices continue to drive people away from cars and into trucks and SUVs."

The automakers are preparing for sedan sales to shrink further — and at least temporarily skew sales numbers. Ford sales chief Mark LaNeve said Thursday the automaker anticipates the all-new Ranger midsize pickup will offset some of the sedan sales slip. But the automaker also announced Thursday it would report its sales figures quarterly rather than monthly, as it expects some volatility as it moves to prune its sedan models from the vehicle lineup.

Fiat Chrysler sales rose on the back of Jeep and Ram sales, which were up 17 percent and 7 percent for the year, respectively. The Chrysler brand slid 12 percent, while the Fiat brand was down 41 percent in the U.S. last year. Fiat Chrysler's new Alfa Romeo Stelvio SUV drove Alfa sales up 98 percent last year.

GM, which began in 2018 reporting quarterly sales, sold its 200,000th electrified vehicle in the fourth quarter, reaching the cap for a $7,500 federal tax incentive intended to encourage electric-vehicle sales.

All four of GM's brands slipped in 2018, with Buick down 5.6 percent and Cadillac down 1.1 percent for the year. Chevrolet was down 1.4 percent as sedan sales for the brand continue to steadily decrease. Truck brand GMC fared the best, down only 0.8 percent for the year, as sales of the Terrain SUV, Sierra full-size pickup and Canyon midsize pickup all posted gains.

Meanwhile, Ford's sedan sales dove 18.4 percent last year. The automaker announced early in 2018 that it planned to cut all car models out of its lineup over the next few years. Ford plans to replace those sedans with consumer-favorite crossovers, a segment in which Ford is weak.

The automaker reported F-Series pickup sales increased 1.4 percent last year. Transit van sales were up 8.2 percent. Only the Fiesta, GT, Expedition, Police Interceptor Utility and Navigator had sales increases in 2018. The automaker sold 54,348 EcoSport compact SUVs, which hit the U.S. market for the first time early last year. Ford's Lincoln brand sales were down 6.8 percent in 2018.

Toyota Motor North America reported sales in 2018 were down 0.3 percent due largely to an 11.9 percent slide in passenger car sales from both the Toyota and Lexus divisions. Toyota's truck and SUV sales were up double-digits for the year.

"Retail demand has actually been stronger in the second half of the year, though down from last year," Jonathan Smoke, Cox Automotive's chief economist said. “We think that’s a result of low unemployment and tax reform leaving consumers confident and flush with cash."

He said that extra cash — combined with lower gas prices, stabilization of interest rates and credit availability for subprime borrowers — made for more ideal buying environment than initially expected.

 

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