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Ford Will Again Increase Production Large Suvs In US For Higher Profits


03/19/2019


Ford Will Again Increase Production Large Suvs In US For Higher Profits
In recent years, United States car customers have shown their increased leanings towards larger, more comfortable vehicles and Ford, eager take advantage if that trend, has decided to increase its largest sport utility vehicles for the US market.
 
Ford executives said in a media briefing that there would be a 20 per cent increase in the rate of manufacturing rate of Ford Expedition and Lincoln Navigator sport utility vehicles from July at the company’s Kentucky Truck plant in Louisville. This would be the second occasion that the company is making a 20 per cent increase in production of both the models this year.
 
This strategy employed by Ford has now become common for US automakers as they try to take advantage of the trend of customers favouring vehicles that are profitable ones. While this is the trend in the American heartland, authorities in California, China and Europe are trying to popularise smaller, electric vehicles with the aim of reducing emission of carbon dioxide emissions which has been directly linked to global climate change.
 
In the US however, an order for freezing of U.S. fuel efficiency standards has been issued by the Trump administration, which would be used by automakers to push for sale of large SUVs and pickup trucks, say analysts.
 
Eight seating large SUVs able to tow a four-ton trailer is gaining popularity and US customers are willing to purchase them even at a premium, given the relative cheap price of gasoline.
 
Ford U.S. marketing director Matt VanDyke said that the average transaction price of a new Ford Expedition is $62,700, which is $11,700 more than the price last year. Ford however does not disclose profits by model line. According to Lincoln data, in February, the average prices for the luxury Navigator increased to $81, compared to last year’s price of $78,000.
 
The average transaction price for its U.S. model lines throughout the US was $38,400 which was more than the industry average of $34,000, Ford had said in January.

Later this year, a new generation of its large SUV Chevrolet Suburban and Tahoe, and GMC Yukon, models would be launched by General Motors Co, the dominant automaker in the North American market for large SUVs. The announcement to re-enter the large SUV segment and launch its new models in late 2020 was made last month by Fiat Chrysler Automobiles NV.
 
Ford North American manufacturing chief John Savona said that in order to accommodate the latest increase in SUVs, portions of the Kentucky Truck assembly line have been redesigned by Ford workers and engineers.
 
He said that in order to increase the speed of installing parts on upper and lower sections of a vehicle by doing it together, workers at certain stations will be positioned at two levels - some in pits and some on platforms, for the first time,.
 
Savona said that about 550 additional hands would be required for the assembly system of the redesigned Expedition and Navigator vehicles. And that gap would be filled by employees currently employed at the Louisville assembly plant of the company where Ford manufactures small Ford Escape and Lincoln MKC SUVs.
 
(Source:www.economictimes.com)