Tag: Capacity

By on July 23, 2012

While all eyes are on GM’s hemorrhaging Opel, Ford is said to be even more affected by the European contagion. Ford could have to close at least one plant in Europe, analysts say, with Southampton, England, and Genk, Belgium, in the cross-hairs. (Read More…)

By on July 20, 2012

Ford last closed a plant in Europe a decade ago, when its Dagenham assembly plant was shuttered, but the Blue Oval may be forced to do it again.

(Read More…)

By on June 29, 2012

A report by Alix Partners, an automotive consulting firm, spells out what we at TTAC have been saying for some time; Europe’s auto industry is facing a major crisis of overcapacity, but no steps have been taken to remedy the matter.

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By on June 7, 2012

The Globe and Mail’s Greg Keenan explored an interesting conundrum that Canadian governmental officials are facing; is it worth subsidizing auto industry manufacturing facilities, even with austerity programs in place?

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By on May 25, 2012

Although news articles on the topic are fairly thin, it seems almost inevitable that Mazda and Fiat will continue doing business together, with the next step involving Mazdas built at Fiat/Chrysler plants.

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By on May 22, 2012

Optimism sure ain’t what it used to be. Introducing its latest survey of auto industry executives [PDF], Booz & Co. proclaims that “optimism is skyrocketing,” and that “a new wave of optimism is overtaking the U.S. auto industry.” They’re not wrong, but for those used to the pre-bailout days of unabashed optimism dressed up as analysis, the “new optimism” is remarkably guarded. And it’s all relative to the pessimism that was beginning to set in when the industry began to realize that the “old optimism” was wildly at odds with the slow-motion market recovery.

So, just how optimistic is the “new optimism”? Which companies have the most reason for optimism? What do industry executives worry about most? When do they expect a Chinese invasion? The answers to these questions and more after the jump.

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By on May 17, 2012

Subaru’s failed relationship with China hasn’t burdened Subaru with too much baggage; the automaker is already moving on, planning to expand its Indiana plant to build more Legacy and Outback models.

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By on May 15, 2012

Exports have been mentioned before as a way to help improve Opel’s precarious near-term fortunes, and now one of Germany’s state-level Prime Ministers is throwing his support behind the export plan.

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By on May 13, 2012


If GM’s Opel would have a jobs bank, its accounts would be bulging. Opel has far too much capacity for far too little sales.  The situation at Opel “is more dramatic than thought,” writes Germany’s Focus Magazin. The magazine got is hands on confidential production plan (most likely leaked by interested parties,) and the numbers are horrific. (Read More…)

By on May 11, 2012

Even though Opel will be tasked with developing the next Citroen C5, PSA will be responding in kind by providing some expertise of their own, in the form of small minivans.

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By on May 8, 2012

A study commissioned by Canada’s federal government suggests that Canada could be in a position to benefit from strong auto sales from the Big Three OEMs, and a lack of capacity could lead to more manufacturing jobs for Canada, including the revival of mothballed factories.

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By on February 10, 2012

More and more U.S, carmakers run their plant 24 hours a day by adding a 3rd shift, reports Bloomberg. U.S. auto plants are estimated to run at 81 percent capacity, up from 49 percent in 2009, IHS Automotive says. In the business, capacity utilization above 80 percent is considered good, anything lower is thought to be an invitation to disaster. (Read More…)

By on May 31, 2011

Though the auto bailout is being widely defended in the political realm as a jobs-saving measure, the industry sees the rescue’s value in precisely the opposite light, as industry and supplier execs rate “capacity rationalization” as the most positive effect of the bailout. And, reports Automotive News [sub], Ford and GM could still end up cutting as many as six more plants over the next few years as questions linger about volume recovery in the larger market. Of the three GM plants likely to be shut down, the former Saturn plant at Spring Hill, TN, is the most likely to survive as it includes a paint shop, a small engine plant and associated parts manufacturing facilities. In contrast, analysts note that GM’s Janesville, WI, plant is the firm’s oldest and is therefore far less likely to survive, and its Shreveport, LA, compact truck plant is part of “Old GM” and will likely be liquidated. Similarly, Ford’s Ranger plant in Minnesota, as well as its Avon, OH Econoline plant and its Flat Rock, MI Mustang plant could face shutdowns. Ranger is running out of production, Econoline has been losing share to Ford’s more-efficient Transit Connect, and Mustang has been losing market share to Camaro while facing a Mazda pullout from the Flat Rock plant.

Because GM is adding jobs at other plants, the net job loss from its three likely shutdowns (two of which are currently idle) could be relatively low, but then cost savings aren’t likely to match those accrued by past shutdowns either. Ford, meanwhile, is facing a bit more disruption if Mazda pulls out of Flat Rock, but could accrue more savings than GM as only the Ranger plant is scheduled to lose its production. In any case, the UAW will have to weigh its desire to keep plants open with its desire to mitigate the inequity of the two-tier wage system… as well as its desire to gain board seats. All of which could make the UAW’s upcoming bargaining session (not to mention the political debate about the auto bailout) much more interesting…

By on January 11, 2011

“There have been companies that have gone belly-up for carrying excess capacity, but no company has gone bankrupt for not being able to produce, We now realize humbly that we shouldn’t make cars until we’re absolutely certain they will sell.”

Toyota’s Executive Vice President Atsushi Niimi to Bloomberg. (Read More…)

By on November 14, 2010

Carmageddon? What carmageddon?

Germany’s auto industry has a huge problem: Way too many customers. “We have that fattest order books of all times,” said Esther Bahne of Audi to Germany’s Spiegel magazine. Result: Customers have to wait months for their cars. Sometimes longer than ever before, says Der Spiegel. (Read More…)

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