Ford makes further cuts to truck production, plans smaller pickup as gas prices dent sales

DETROIT May 20, 2008; Dee-Ann Durbin and Tom Krisher writing for the AP reported that Ford Motor Co. said Tuesday it will further cut production of its pickups and large sport utility vehicles, which have seen sales plummet due to high gas prices and the slump in housing construction.

The company, anxious to hold onto its longtime lead in U.S. pickup sales, also is working on a smaller, more fuel-efficient version of its best-selling F-150 pickup that will likely hit the market in 2011, according to people who have been briefed on the company's plans.

Ford spokeswoman Angie Kozleski confirmed that the Michigan Truck plant in suburban Wayne would be shut down for five weeks starting in late June. The plant makes the Ford Expedition and Lincoln Navigator large SUVs, both of which have seen double-digit sales drops so far this year.

In addition, two people familiar with Ford's production plans say the Kentucky Truck plant in Louisville, Ky., will be shut down for four weeks in July. The people did not want to be identified because the company has not made its plans public. The Louisville plant makes the company's F-Series Super Duty pickup trucks.

Kozleski wouldn't confirm the Kentucky Truck closure but said the plant will see one-week shift layoffs on a rotating basis through the month of May. Those changes and the changes at Michigan Truck are due to decreased demand for vehicles made at the plants, she said.

"What we're looking at is how you continue to align your capacity with demand," she said.

Auto companies normally shut down their U.S. plants for two weeks in July to retool for the next model year. These closures will extend the regular shutdowns.

Ford said in March that it planned to cut North American production by 10 percent in the second quarter because of slow U.S. sales, but the production cuts at Michigan Truck and Kentucky Truck would come on top of that. Kozleski wouldn't say if there are further production cuts planned.

U.S. sales of full-size pickups peaked in 2004 at 2.5 million vehicles but have dropped ever since as gas prices climbed and the slowing housing market pinched sales of work vehicles. The F-series trucks remain the best-selling vehicles in the U.S., but sales were down 16 percent in the first four months of this year.

Under pressure to make its trucks more fuel efficient, Ford is planning to build a smaller pickup on a modified version of the F-150 platform, according to two people who have been briefed on the company's plans. The people asked not to be named because the plans aren't yet public.

The truck would use lighter-weight materials such as aluminum and thinner, high-strength steel and would be about the size of the Ford Ranger compact pickup. Instead of a V-8, the truck would likely have a 6-cylinder engine with some extra kick from Ford's EcoBoost technology, which uses turbocharging and direct-injection to improve performance and fuel economy.

The truck would be built at the Michigan Truck plant in Wayne. Ford is considering resurrecting the F-100 name, which was used for entry-level F-series pickups until 1983 when Ford introduced the Ranger.

The U.S. version of the Ranger is still being made, but production is expected to end next year when Ford closes the St. Paul, Minn., plant that makes it. Ford is considering bringing a global version of the Ranger, which is made in Thailand, to the U.S. market in addition to the F-100 depending on gas prices, according to one of the people. The global Ranger is slightly smaller than the U.S. Ranger.

Ford spokeswoman Becky Sanch said Tuesday she couldn't comment on the company's plans.

Chrysler LLC wouldn't comment on whether it is producing a similar small truck for its Dodge lineup. General Motors Corp. spokesman Terry Rhadigan also wouldn't say whether GM has a similar program, but he did point out that the automaker will be releasing fuel-saving hybrid versions of its GMC Sierra and Chevrolet Silverado pickups by the end of this year.