Auto Factories Add Production, Skip Summer Shutdowns
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DETROIT (WWJ) – The traditional two week auto shutdown is starting to fade into automotive history, like fins and running boards.
With sales up seven percent so far this year, and fewer factories than before the recession, car companies can afford very little in the way of voluntary down time. And they certainly can’t let inventories of their most popular products fall.
“You certainly don’t want to be caught without vehicles,” says analyst Jeff Schuster with LMC Automotive. “There are other choices out there if your vehicles are not on lots that are very comparable.”
Chrysler is skipping the summer shutdown entirely at both of it’s Detroit plants. Jefferson North makes the Jeep Grand Cherokee and Dodge Durango. The Connor Avenue plant makes the Dodge Viper. All of those vehicles are new, and in short supply.
The company’s Toledo North Jeep plant will also be open all summer. That plant has just reopened after a long shutdown to change over from Jeep Liberty production to production of the new Jeep Cherokee.
Because of this, most Chrysler powertrain and stamping plants will be open all summer. Four Chrysler assembly plants will have one week shutdowns. Four others will be down the traditional two weeks.
Ford says most of its plants will cut their summer shutdowns from two weeks to one.
“To meet surging customer demand for our top-selling cars, utilities and trucks, we are continuing to run our North American facilities at full manned capacity, and we will add 200,000 units of annual straight-time capacity this year,” said Jim Tetreault, Ford’s vice president of North America Manufacturing. “Approximately 75 percent of our plants are running at a three-crew, three-shift or four-crew pattern in order to ensure we’re getting more of our products into dealerships.”
Ford says it’s in the process of adding 3500 manufacturing jobs this year.
The other major carmakers are in expansion mode as well.
General Motors hasn’t traditionally had coordinated summer shutdowns. With the company in the midst of updating 70 percent of its products, GM North America President Mark Reuss says they can’t afford any down time this year.
“Never say never,” said Reuss. “But, right now we’re launching 23 cars and trucks, so it’s pretty fluid.”
Reuss said the only downtime GM will take is as needed to prepare plants for new models.
The decision to skip most summer shutdowns, says LMC Analyst Jeff Schuster, is a very good sign for the second half of the year. He says May is usually the time auto companies look at their internal forecasts and try to determine what the rest of the year will be like.
“I think this is a signal that the industry is looking to push through it, and continue to have stable growth as we look at the second half of the year.”
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