By on December 7, 2017

Image: Ford

In public, automakers talk a great game about the industry’s electric future. The money poured into the development of electric vehicles is necessary, they say, in order to stay competitive in a changing marketplace. It wasn’t long ago that Ford claimed 100 miles of range was just fine for an EV model; not long after, following the introduction of the 238-mile Chevrolet Bolt, it announced the development of an EV crossover with far greater (300-mile) range.

Whether or not electric power becomes the dominant propulsion source in the United States remains to be seen, but no automaker can be seen resting on its laurels, shunning the most hyped technology. That doesn’t mean a company can’t be realistic about it, though.

Ford’s electric crossover, expected to roll out of Michigan’s Flat Rock assembly plant in 2020, will instead roll out out of a factory in a much warmer (and cheaper) locale.

News of the production change comes by way of a company memo obtained by Automotive News. Ford’s EV crossover — the byproduct of a $700 million investment into the Flack Rock plant — will be built in Cuautitlan, Mexico. Ford Motor Company has confirmed this report.

“This allows us to bring this exciting new vehicle to global customers in a more effective way to support our overreaching business goals,” the memo stated.

There’s no one alive today who believes a Mexican production line is more expensive to operate than an American one. Ford’s beancounters clearly felt the model’s production costs, coupled with uncertainty over its popularity with EV-hesitant U.S. consumers (and the need for an affordable sticker price), necessitated a trip south of the border. It’s a trip recently made by another Flat Rock alumnus, the Ford Fusion.

Calling the model “affordable” and “mainstream” earlier this year, Ford chief technology officer Raj Nair said, “We think we have a technology path that will get us a 300 plus miles range and an affordable crossover utility that will be fully competitive.”

The biggest concern surrounding EVs these days, besides the potential for battery-based mineral shortages, is how automakers can make a profit from vehicles that are much more expensive to produce than regular cars. General Motors claims it has a plan. Now, Ford seems to have one of its own.

The Blue Oval is downplaying the crossover’s move, preferring to highlight changes to the plant itself. Ford has announced another $150 million for Flat Rock — and another 150 jobs — in the interest of bulking up its development of autonomous vehicles and freeing up production space. The company now plans production of a commercial-grade self-driving vehicle powered by a hybrid drivetrain. The model will carry a new nameplate, the company says.

“We see a bigger opportunity now than we originally saw,” Ford spokesman Allan Hall told Automotive News.

The as-of-yet-unnamed autonomous model is expected to appear in 2021.

[Image: Ford Motor Company]

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29 Comments on “Michigan to Mexico: Ford’s Upcoming Electric Crossover Moves House...”


  • avatar
    dima

    Is this a surprise? No, really.

    • 0 avatar
      Adam Tonge

      Sort of?

      Ford had to find a product for Cuautitlan now that the Fiesta is leaving.

      Every other NAFTA factory has product.

      They are undoing the mistakes of Fields.

  • avatar
    mr.cranky

    Look for some angry tweets from the manchild-in-chief over this one. If he hasn’t already that is.

  • avatar
    DeadWeight

    MAAAAAAAAAAGGGGGGGGAAAAAAA!!!!

    The U.S. now, as of November 2017, has a record trade deficit with China!

    Expect similar trends w/respect to Mexico!

    So much winning and MAGA that IT HURTS!

    Trump will repeal NAFTA, BUILD A 2,200 MILE WALL ALONG THE MEXICO BORDER (that Mexico will pay for, really), FORCE CHINA TO BALANCE ITS TRADE WITH THE U.S., AND COMPEL GLOBAL CORPORATIONS TO MOVE FACTORIES, ASSEMBLY FACILITIES, R&D, AND HUMAN JOBS IN RELATED INDUSTRIES (CARRIER,HVAC, GE, AUTO INDUSTRY, ELECTRONICS’ FABRICATION, ETC.) BACK TO ‘MURICA!!!!

    IT’S GOING TO BE SO BEAUTIFUL AND GREAT, BELIEVE ME, YOU WILL LOVE IT….TRUST ME!!!

    “Trade deficit soars on record imports from China.”

    https://www.bloomberg.com/news/articles/2017-12-05/u-s-trade-deficit-is-widest-since-january-on-record-imports

    China Sept trade surplus with U.S. highest on record – Reuters calculations
    Published 11:58 PM ET Thu, 12 Oct 2017

    “BEIJING, Oct 13 (Reuters) – China’s trade surplus with the United States in September rose to $28.08 billion versus $26.23 billion last month, Chinese customs data on Friday showed.

    The surplus was the highest ever with the U.S. for any single month, based on Reuters calculations based on official data going back to 2008.

    China’s Jan-Sept trade surplus with the U.S. was $195.54 billion, the data showed.”

    *So, it will be approx 280 to 300 billion on the year (Chinese exports surge near November through end of December).

    MAGA

    Mexico’s Auto Production and Exports Having a Record Year
    By Anthony Harrup Published December 06, 2017 Features Dow Jones Hardwired

    http://www.foxbusiness.com/features/2017/12/06/mexicos-auto-production-and-exports-having-record-year.html

    “MEXICO CITY –  Mexico’s production and exports of light vehicles this year through November have already surpassed the record levels set in 2016 as demand increases from the U.S. and Canada, auto industry officials said Wednesday.

    The production of 332,449 vehicles last month was 4.5% higher than a year ago. For the first 11 months of this year, production was up 9.4% at 3.53 million, above the 3.47 million vehicles turned out in all of 2016. Exports through November were up 12% at 2.85 million units, higher than the 2.55 million in the first 11 months last year. There were 2.77 million vehicles exported in all of 2016.

    The record output and exports in 2017 consolidate Mexico’s position as the world’s fourth-largest exporter and seventh-largest producer of vehicles, said Eduardo Solís, president of the Mexican Auto Industry Association. He said production is expected to reach at least 4 million units in 2018, and exports 3.2 million.”

    MAGA

    Carrier plans final layoffs at plant Trump vowed to protect: report
    BY REBECCA SAVRANSKY – 11/09/17 07:22 AM EST

    http://thehill.com/homenews/administration/359545-carrier-plans-more-layoffs-at-plant-trump-struck-deal-with-report

    “Carrier, which struck a deal with President Trump last year to keep jobs at its Indianapolis plant, is readying itself for a final round of layoffs at the facility.

    More than 200 employees will lose their jobs in January, Fox News reported.

    Robert James, the president of the union that represents plant workers, said employees “just don’t have any faith in this plant staying in Indianapolis.”

    Remember That Carrier Plant Trump Promised To Save? Another 215 Workers Have Been Laid Off
    By Jason Easley on Thu, Nov 9th, 2017 at 10:12 am

    It turns out that the $7 million in tax breaks that Trump and Pence gave Carrier meant nothing as another 215 workers have been laid off and there are no signs that the Carrier plant is going to stay in Indianapolis.

    http://www.politicususa.com/2017/11/09/remember-carrier-plant-trump-promised-save-215-workers-laid.html

    MAGA

    MAGA! SO MUCH MAGA!!

    Trump is a year into office and the MAGA is so strong!!!

  • avatar
    DeadWeight

    MAGA

    ‘Ivanka Trump’s China business ties are more secret than ever

    Public information about the companies importing Ivanka Trump goods to the U.S. has become harder to find.

    Information that once routinely appeared in private trade tracking data has vanished, leaving the identities of companies involved in 90 percent of shipments unknown.

    The deepening secrecy means it’s unclear who Ivanka Trump’s company is doing business within China.

    An AP review of the records that are available about Ivanka Trump’s supply chain found two potential red flags. In one case, a province in eastern China announced the award of export subsidies to a company that shipped thousands of Ivanka Trump handbags between March 2016 and February of this year, Chinese public records show — a possible violation by China of global fair trade rules, trade experts said.

    The companies that shipped Ivanka Trump merchandise to the U.S. are listed for just five of 57 shipments logged by Panjiva from the end of March, when she officially became a presidential adviser, through mid-September. Panjiva collects data from U.S. Customs and Border Protection, which did not immediately release the missing data to AP.

    While in many cases the manufacturer ships goods directly, merchandise can also be made by one company and shipped by another trading or consolidation company.

    There used to be more visibility. Last year, 27 percent of the companies that exported Ivanka Trump merchandise to the U.S. were identified in Panjiva’s records, and back in 2014 a full 95 percent were named. For two of Ivanka Trump’s licensees — G-III Apparel and Marc Fisher Footwear — the number of shipments appears to plunge in 2015, likely because they “requested to hide” their shipment activity, according to Panjiva records. Neither company responded to AP’s questions.

    The brand declined to comment on the growing murkiness of its supply chain.”

    Published 7:33 AM ET Tue, 26 Sept 2017 Updated 7:44 AM ET Tue, 26 Sept 2017

    https://www.cnbc.com/2017/09/26/ivanka-trumps-china-business-ties-are-more-secret-than-ever.html

  • avatar
    threeer

    It’s all good, as long as Americans can get it cheap (well, for those still employed, that is). How long can a country truly survive if they outsource so much of there wealth to other countries?

    • 0 avatar
      Adam Tonge

      While I don’t like product going to Mexico that could be built here, this is the best case scenario. Cuautitlan needed product. Ford has to build something there.

    • 0 avatar
      DeadWeight

      Donald J. Trump will eliminate China’s trade surplus, get corporations with factories in the U.S. to keep them here, get corporations with factories in Mexico and Asia to move them to the U.S., stop North Korea’s nuclear program, build a great, big, beautiful wall, lower taxes for the middle class (/s), stop overreaching U.S. Foreign military interventionism, reduce the deficit and deficits and debt, drain the swamp, and MAGA…

      ….BELIEVE HIM.

  • avatar
    deanst

    “This allows us to bring this exciting new vehicle to global customers in a more effective way to support our overreaching business goals,” the memo stated.

    Overreach – “to try to do more than your ability, authority, or money will allow.”

    “You keep using that word. I do not think it means what you think it means.” — Inigo Montoya, The Princess Bride

  • avatar
    stingray65

    As long as EVs are unprofitable, the only way to slow the bleeding of red ink will be to move EV production to low cost countries. All the EU and US green bureaucrats who are pushing EVs might be disappointed when all those “green jobs” end up in Mexico and China.

  • avatar
    FreedMike

    Makes sense…

  • avatar
    NN

    Mexico has more free trade agreements with additional countries, which makes it a beneficial global production location. For example, they have a free trade agreement with Brazil, which the US does not. You can see that the new Chevy Equinox (Hecho en Mexico) is selling in Brazil. The prior US-made version never did. That’s another reason given for the Fusion being made in Mexico. Brazil has a 2M+ annual automotive market and extremely high import duties.

    On free trade agreements–if you don’t have one, someone else does, and you lose the business.

    At the end of the day, the domestic manufacturers will continue to move most everything out of the US save for your F150’s and Wranglers. Meanwhile, Toyota, Honda, Nissan, etc. continue to expand US operations.

  • avatar
    kamiller42

    The formula is simple:
    Low profit margin, manufacture out of U.S., likely Mexico.
    High profit margin, manufacture in U.S./Canada.

    • 0 avatar
      FreedMike

      Yep.

    • 0 avatar
      DeadWeight

      Jack Baruth’s new Chevy Silverado was Hecho En Mexico, and is one of the vehicles that is literally keeping Guangzhou-Guadalajara Motors from being in an operating loss position, given its outsized-profitability and the strong pickup truck sales environment during the last 6 years.

      • 0 avatar
        Adam Tonge

        GM’s strategy is different.

        Ford’s strategy is mostly “high margin US/Canada. Low margin Mexico.”

        The products Ford builds in Mexico will be the Fusion/MKZ, Focus, and this EV CUV. Hopefully the MKZ goes to the US at some point on a RWD platform. I won’t hold my breath, but something like that could be built in Chicago or Flat Rock.

  • avatar
    brettc

    So is Ford going to be building charging networks too, or will that be up to VW (to pay for their stupidity) and fuel stations?

    Full electric is nice but charging them easily on a trip is nicer.

  • avatar
    dukeisduke

    So where’s the hidden weed compartment?

    • 0 avatar
      Scoutdude

      In the floor like on the C-Max?

      Of course it won’t be that long until it really doesn’t matter any more. The legalization train has left the building, built up a huge head of steam and decimated the black market in those states that have legalized.

  • avatar
    PandaBear

    This is what happen if you screw with trading partners that can bypass you. Mexico and China can trade EV with each other so US don’t have to do anything with it.

    I’d not be surprised Mexico and China do this even if it is not cheaper than trading with the US, just as a big FU to DTJR.

  • avatar
    musiccitymafia

    Are there still consumer incentives to buy EV’s? If so, and since these are really just transfers of funds to the manufacturers, does it make sense to collect taxes to give to companies for product they manufacture in another country? We won’t be able to tax the mexican workers to collect some of this back?

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