Engine shortage from Mexico could shut down Ford plants in US
Ford Motor Co. may have to shut down production at plants in the U.S. due to a shortage of engines from Mexico.
The supply issue and potential shutdown was first reported by Reuters, which cited comments made Thursday by the U.S. Ambassador to Mexico Christopher Landau during a talk organized by the Atlantic Council.
In a statement, Ford confirmed it is experiencing a supply issue: "Due to COVID-19, the State of Chihuahua in Mexico has limited employee attendance to 50%, a region in which we have several suppliers," said Kumar Galhotra, president of Ford's Americas and International Markets Group. "With our U.S. plants running at 100%, that is not sustainable. While we do not expect any impact to production next week, we are continuing to work with government officials on ways to safely and constructively resume remaining production."
According to Reuters, at issue are engines produced in Mexico for Ford vehicles. Landau said he discussed the issue with an unnamed senior Ford executive on Wednesday: "They're saying that they're going to start shutting down factories in the United States as of next week if they don't get that rolling," Landau said, Reuters reported.
Ford declined to provide further comment about the timing of a potential shutdown and what U.S. plants or vehicles would be affected.
Ford's Chihuahua Engine Plant currently makes the Duratec I4, Scorpion 6.7-liter and Diesel V8 4.4-liter engine lineups, according to the company's website. The Scorpion 6.7-liter engine is used to power Ford's Super Duty pickups. The plant's current product lineup includes at least two engines used in hybrid vehicles.
A widespread U.S. production shutdown would be a major setback for the effort to restart auto manufacturing amid the coronavirus pandemic. Detroit's three automakers shut down North American production for eight weeks, from the end of March to mid-May, to help stop the spread of COVID-19.
The simultaneous restart of all three automakers was a historic moment in the industry, and one that experts said would be a major test, given possible disruptions in the industry's global supply chain and the need to prevent COVID-19 from spreading within plants.
Ford, along with its crosstown rivals, restarted on a reduced production schedule. But within five weeks, the Dearborn automaker announced it was back to full, pre-coronavirus production levels, ahead of schedule. All three automakers have been rushing to fill depleting inventories on dealership lots, as consumer demand for new vehicles has rebounded stronger than expected.