For $75 million, Michigan Truck will soon roll out cars

Today, the factory is in the middle of an 11-week shutdown. Production was halted because dealers could not sell the trickle of oversized sport utility vehicles the plant's single shift churned out. Next spring, Ford will move production of the Ford Expedition and Lincoln Navigator to its Kentucky Truck Plant. After that, Ford will begin retooling Michigan Truck to produce smaller, more fuel-efficient vehicles based on its new global compact platform. The plant's 1,000 employees will be transferred next door to the Wayne Assembly Plant, where Ford will add a third shift in January to produce more of its hot-selling Focus compact cars, which are in great demand as high fuel prices send consumers scrambling to less thirsty vehicles. The moves are all part of a radical retooling strategy the automaker announced last month. If it succeeds, it will make Ford one of the most versatile car manufacturers on the continent and give the company the flexibility it needs to respond to a rapidly changing market. As part of the plan, Ford also will convert truck and SUV plants in Mexico and Kentucky to car production. While financial details of those projects have not been disclosed, the company estimates each will cost approximately $250 million to retool. Ford global manufacturing chief Joe Hinrichs said Michigan Truck can be done on the cheap because the company already invested some $300 million here three years ago to build a tooling system that allows the plant to produce several different models on the same assembly line. Since then, the equipment has been used to build different types of SUVs, but most of the same tools -- 80 percent -- can be used to produce more fuel-efficient cars and crossovers. 'We already have a flexible body shop and we have the ability to convert it fairly inexpensively,' Hinrichs said. 'Because we're only one shift, we're not taking advantage of that flexibility that we put in back in (2005). This plan allows us to do that, and take advantage of it going forward.' When the retooling is completed next year, Ford will be able to produce eight different models on the same assembly line at Michigan Truck, which will by then have been renamed to reflect its new focus. Ford has not yet decided what the new name will be. 'We'll have the flexibility to mix those products as market conditions change,' said Bruce Hettle, Ford's director of manufacturing engineering for vehicle operations. That is something analysts say is key to Ford's success going forward. Patrick Dessert, director of the Product Development and Manufacturing Center at Oakland University in Rochester, said overcapacity and an increasingly fragmented car market have forced Ford to rethink its entire production model. 'Henry Ford's initial idea was economies of scale,' said Dessert, who has advised Ford on Michigan Truck. 'You could have any car you wanted as long as it was black. Today, you've got to be able to move and roll with market.' Analyst Erich Merkle of Crowe Chizek and Co. said Ford is playing catch-up with foreign rivals. 'These are investments that needed to be made a long time ago,' he said. 'Honda and Toyota have been doing this for years, and they're the only ones that have been able to handle this transition in the face of high gas prices.' Hinrichs said Ford already has done that in other countries. Its assembly plant in Camaari, Brazil, is considered a model of flexible manufacturing. But only one of Ford's North American factories -- the Oakville Assembly Plant in Ontario, Canada -- is building more than one platform on the same line at the same time. 'Around the world, we have lots of flexibility -- and we take advantage of it,' Hinrichs said. 'We've been on a journey here in North America to do the same thing.' Some observers have criticized Detroit automakers for possibly moving too quickly to shift truck production to cars. Hinrichs noted that Michigan Truck will also be able to produce trucks and SUVs again if the market demand returns. You can reach Bryce Hoffman at (313) 222-2443 or [email protected].

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