Subscribe or upgrade your account to read:

Ford suspends F-150 production after plant fire

Companies

Ford suspends F-150 production after plant fire

US automaker Ford said on Wednesday that it was halting production of its popular F-150 pick-up truck after a fire last week at one of its parts suppliers.

Ford is suspending production of the F-150, its most popular and profitable vehicle, at plants in Kansas City, Missouri, and Dearborn, Michigan, while halting production of another model, the Super Duty, at another plant in Louisville, Kentucky.

​Ford executives said on a media call that the company has 84 days of supply of the best-selling F-series trucks, adding that the disruption is likely to last for at least several days. Sales chief Erich Merkle said, “it’s hour to hour . . . we can’t say beyond that”.

The move comes after a May 2 explosion and fire at Meridian Magnesium Products of America in Michigan, which has led to a shortage of die-cast components, Ford said.

Joe Hinrichs, executive vice-president and president of global operations, said:

“This is a fluid situation, but we are working closely with our supplier partners to do everything we can to limit the impact on our production. It’s a full team effort and we’re confident that any impacts will be short term. The good news is we have strong inventories of our best-selling F-series pick-ups and other vehicles, and customers won’t have a problem finding the model they want.”

While the production halt will probably have a negative impact on its short-term earnings, Ford said that it was standing by its full-year guidance for adjusted earnings per share between $1.45 and $1.70.

Charlie Chesbrough, auto industry economist at Cox Automotive said the impact will depend on the length of the shutdown.

“A short-term disruption can often clear out inventory and allow for strict pricing. A long-term shut down can be much worse. In Ford’s case, the timing is difficult with the new Ram truck in the market and new GM Silverado coming this summer. A major disruption could not come at a worse time for Ford — 70,000 sales each month are at stake.”

For shares were down 0.18 per cent in after-hours trading.

Copyright The Financial Times Limited . All rights reserved. Please don't copy articles from FT.com and redistribute by email or post to the web.

Content not loading? Subscribers can also read Ford suspends F-150 production after plant fire on ft.com