Lincoln MKC Assembly Stays Put in Kentucky, But Trump Muddies the Waters

by Steph Willems

Published: November 18th, 2016

lincoln mkc assembly stays put in kentucky but trump muddies the waters

Ford’s Louisville, Kentucky assembly plant will continue to crank out Lincoln MKC crossovers, rather than head down south for a Mexican vacation.

The news, which Ford confirmed after an enthusiastic President-elect Donald Trump tweeted it, means the automaker will need to look elsewhere for more Escapes. It doesn’t, however, mean a factory closing was averted.

Louisville Assembly currently builds the Ford Escape and Lincoln MKC, but production of the littlest Lincoln was scheduled to go elsewhere once the automaker’s UAW contract expires in 2019. According to Automotive News, Ford spokeswoman Christin Baker had previously said the likely destination was the Cuautitlán assembly plant in Mexico.

Not anymore. In a tweet posted last night, Trump stated, “Just got a call from my friend Bill Ford, Chairman of Ford, who advised me that he will be keeping the Lincoln plant in Kentucky – no Mexico.”

Ford has confirmed that the MKC will remain in the Bluegrass State.

Critics pounced on the president-elect’s word usage and declared the tweet misleading, as the Louisville plant — which employs about 4,700 workers — was in no danger of closing. Simply swap out the word “plant” for “assembly” in Trump’s tweet, and there’s no problem. Semantics aside, what does the change in heart mean for the Escape?

The planned MKC move was supposed to free up plant space to boost production of the popular compact crossover. If it wants more Escapes for the domestic market, Ford will need to find space elsewhere. However, it might not have to — at least for now. North American Escape sales reached a plateau in 2014, and despite the popularity of crossovers and SUVs, overall new vehicle sales in the U.S. are on the decline. MKC sales haven’t budged beyond the high-water mark set last year.

Of course, the revamped production plans concern the next-generation Escape and MKC. The marketplace could change by then, and Ford could find itself with extra demand for updated models. Interestingly, a production forecast prepared last year by accounting firm UHY LLP shows Ford Escape assembly added to the Cuautitlán, Mexico plant, with production starting in December of 2018.

[Image: Ford Motor Company]

#Ford #FordEscape #Lincoln #LincolnMkc #LouisvilleAssemblyPlant #Mexico #Production #Trump

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Ronnie Schreiber on Nov 18, 2016

According to the WSJ's sources at Ford, this was apparently a peace offering extended to the incoming administration and that Ford is cultivating a constructive relationship with Trump: "Ford Motor Co. Chairman Bill Ford called President-elect Donald Trump to extend an olive branch this week, saying the Dearborn, Mich., auto maker is shelving a plan to move production of a Lincoln crossover SUV from Kentucky to Mexico. Mr. Trump tweeted about the call Thursday night and Ford quickly confirmed the move... Mr. Ford’s call represented a genuine change in direction for the auto maker, not just a symbolic gesture, according to people close to the executive. The auto maker has been in contact with Mr. Trump’s transition team over the past 10 days, and executives see the Lincoln move as a relatively painless but authentic way to give Mr. Trump a victory even before he moves into the White House... Importantly, Ford’s statement Thursday night indicated it is banking on Mr. Trump’s new economic policies to address the disadvantages that U.S. auto production carries. “ “We are encouraged that President-elect Trump and the new Congress will pursue policies that will improve U.S. competitiveness and make it possible to keep production of this vehicle here in the United States,” the company said." As for Trump falsely taking credit for keeping an entire assembly plant here, if you don't have a problem with "You can keep your plan if you like it", Trump's exaggeration shouldn't bother you.

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- Gtem on Nov 18, 2016
  
  Very interesting indeed.
  
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Ronnie Schreiber on Nov 18, 2016

Few American companies want tariffs so they're going to try to make nice to the Trump administration. News out of Foxconn is that Apple has asked their vendors to look into contingency plans for moving production to the United States. I disagree with Mr. Trump about the possibility of bringing back millions of manufacturing jobs. Currency manipulation and unfair trade practices aside, the main reason why we've lost so many manufacturing jobs is productivity and automation. The U.S. is manufacturing more stuff than ever, it just takes fewer human hands. I'd rather have a system that encouraged entrepreneurship and the creation of new businesses rather than chasing factory jobs that will disappear in China just as surely as they've disappeared here. Still, presidents and presidents-elect jawboning does have some effect.

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- Gtem on Nov 18, 2016
  
  "The U.S. is manufacturing more stuff than ever, it just takes fewer human hands." I think this is incorrect in an important way Ronnie. People will always point to manufacturing output in dollar amounts and how that has risen, but this is skewed largely (I think) by high tech high value manufactured products (think jet engines and such), while our domestic production of lower end durable goods and things like appliances, automotive components, and electronics has dropped dramatically. Or looking at a figure like number of factories on a state by state basis, I think you'd be hardpressed to find a state where that number has risen. And I think that's where the problem lies for a lot of people, and what Trump is talking about at all his rallies in down-and-out locales. Having said all that, I don't have sources for this suspicion of mine, and will willingly be corrected. I definitely agree that productivity on a per-worker basis has skyrocketed, no arguments there at all.
  
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- Bikegoesbaa on Nov 18, 2016
  
  @gtem I think you'll find that the number of manufacturing sites has increased significantly in many Southern states over the last ~20 years. If dollars are not the right metric for manufacturing output then what do you recommend instead? Gross tonnage? I submit that dollars are the right unit because the only reason that manufacturing exists as a human activity is to create value, and dollars are a pretty direct measurement of that. Jet engines *should* count for more than an equivalent mass of pig iron.
  
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- Gtem on Nov 18, 2016
  
  @bikegoesbaa Perhaps something more nuanced, like graphs showing quantities of specific items overlaid on one another? Something like automobiles, appliances, consumer grade electronics, clothes, etc, etc. It'd be a pretty messy graph, but it could give a very quick snapshot of what industries are very much alive here in the States, and what has all gone overseas. It's great that we make high tech high value stuff like that, but I contend that having a shoe factory or stove factory that has the same quarterly $$$ output as that jet engine plant probably employs more people. Ultimately what I'm trying to say is: why not have BOTH? As an aside, I had the distinct pleasure to be treated to a fried turkey lunch at a local plastic injection molding facility yesterday, and got to walk the floor for a bit. A lot of automotive pieces like LED lenses on headlights, intake tracts and airboxes. Fairly automated setups no doubt, but still plenty of floor personnel. My guess is that these folks are non-union, and not paid terribly well (on the order of $10-12/hr maybe?). Oh well, at least they got to bring their families in for fried turkey.
  
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