By Nick Bunkley, Crain News Service
DETROIT — Ford Motor Co. said on April 5 that it will invest $1.6 billion to build a new small-car assembly plant in Mexico, creating 2,800 jobs by 2020.
The factory, according to a Ford statement, will be in the state of San Luis Potosi — the same place where last year Goodyear announced it is building a tire plant. Construction on the auto-making facility will begin this summer, and production is scheduled to begin in two years.
Ford said the move will not affect jobs in the U.S., where it has hired 25,000 workers in the past five years. Still, the news reinvigorated criticism from Republican presidential candidate Donald Trump and others over Mexico's growing role in the North American auto industry.
“We're a proud American company,” Joe Hinrichs, Ford's president of the Americas, told Automotive News, a sister publication of Tire Business. “We set up our global manufacturing footprint and our facilities where we think it makes the most sense for our business.”
United Autoworkers (UAW) President Dennis Williams called the news “very troubling.”
“For every investment in Mexico, it means jobs that could have and should have been available right here in the USA,” Mr. Williams said in a statement. “Companies continue to run to low-wage countries and import back into the United States. This is a broken system that needs to be fixed.”
Ford, based in Dearborn, Mich., had previously said it plans to discontinue production of the Focus and C-Max compact cars at its Michigan Assembly Plant in 2018.
Mr. Hinrichs declined to identify which vehicles the plant in Mexico will make or give an indication of the plant's annual production capacity. UAW officials and analysts have said they expect Focus assembly to move to Mexico in 2018.
The move comes amid waning demand for small cars, which are generally among the least-profitable vehicle segments, as consumers buy more crossovers, SUVs and pickups instead. Ford is expected to build a midsize pickup and eventually at least one SUV at the Michigan Assembly Plant after Focus production ends there, though it has not made any official announcement.
San Luis Potosi will be the site of Ford's first all-new North American assembly plant since 1986, when its Hermosillo, Mexico, factory opened. Ford overhauled an existing facility to create the Dearborn Truck Plant a few miles from its headquarters in 2004.