Ford expects that investing heavily in a new assembly plant will reduce costs. If everything goes according to plan, the change could reinvent vehicle assembly more than a century after the original system was invented.
What Is Ford Planning to Do?
The automaker plans to adopt a tree-based assembly method that constructs vehicles from the ground up instead of using a continuous rolling line. This should reduce the number of components and enable faster manufacturing. By cutting the labor and time required to assemble SUVs and trucks, Ford projects as much as a 20% reduction in parts costs and a meaningful decrease in overhead.
The Goal Is to Compete With China
By revamping the assembly process, Ford aims to reduce costs enough to take on competitors in China and other countries. Overseas manufacturers often benefit from different labor and regulatory conditions that allow them to produce more affordably and quickly. Making manufacturing more efficient could allow Ford to keep production in the U.S. while remaining competitive internationally.
America Gets a Boost Too
Domestic production also strengthens the national economy. A new plant supports the local community, since nearby businesses gain customers with more spending power. Although complete domestic-only production is rare, Ford hopes the investment will help stabilize U.S. manufacturing.
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