The automotive industry is huge. It extends beyond the big-name manufacturers and into the supply chain network that is scattered throughout the globe. Ford is one of those big-name manufacturers, and when COVID-19 started to impact the overseas suppliers, it also affected the Ford plants here in the United States. In essence, it is this domino effect that is still affecting Ford today.
COVID-19 created a lack of components
So, when COVID-19 started to affect the world, a lot of production plants around the world started to shut down. Although Ford has redundant suppliers, when the world is ostensibly shut down, even the redundant suppliers have their own issues. The whole situation left manufacturers without their regular deliveries of components needed to complete vehicles. Conversely, as supplier plants fired back up to produce parts again, the Ford plants started to receive shipments and could complete their vehicles again.
COVID is still an issue for Ford
According to a Reuter’s report posted this afternoon, an engine plant used by Ford is located in an area of Mexico that is still limited to fifty percent of industrial capacity. That ordinance is dictated by the regional authorities. The report says the Mexican government, “has given automakers, mining firms and builders, with activities deemed essential, the green light to restart work in Mexico, though some states have implemented their own restrictions as the coronavirus pandemic rages on. The engine plant is located in Chihuahua, Mexico, where the fifty percent restriction is in place.
Another domino effect is about to happen consequently. That is, Ford may have to shut down production plants in the United States due to a lack of available engines coming from the Mexican plant. The U.S. ambassador to Mexico, Christopher Landau, said, “they’re going to start shutting down factories in the United States as of next week if they don’t get that rolling”
The Ford engine plant in Chihuahua
The Ford engine plant in Chihuahua, Mexico, opened in 1983. It sits on a 247-acre campus with a plant measuring 727,000 square feet. There are over 1,500 employees at the plant producing the 2.0-liter Hybrid, 2.5-liter, 2.5-liter Hybrid, 2.5-liter T6, 1.5-liter, 4.4-liter, and 6.7-liter engines. According to Border-Now, “the engines produced in Chihuahua are exported to various parts of the world, including the United States, Canada, South America, and the Asia Pacific region.”
The Detroit Free Press reached out to Ford. Ford responded. Kumar Galhotra, Ford president, Americas and International Markets Group, offered the following, “Due to COVID-19, the State of Chihuahua in Mexico has limited employee attendance to 50 percent, a region in which we have several suppliers. With our U.S. plants running at 100 percent, 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.”
Every region has a different timetable
It is easy to forget that because one part of the world is returning to normal, or a new normal, that it does not necessarily mean the rest of the world is moving at the same pace. The Ford Chihuahua plant restrictions are a single domino on a large table full of dominoes that Ford is trying to get running again. However, COVID-19 is still a health and safety concern. Eventually, everything will flow again as it did pre-COVID. For the time being, though, Ford is going to have to find workarounds or face others of its plants being engineless soon.