Ford is halting Mustang production

[ICU812]

The news is good at overstating facts, it’s what sells and gets everyone into a frenzy... and this applies to ALL news outlets.

I am sure the dealerships are loving it, as they can used that as a way to sell the units for sticker or close to it.
Ford isn't even trying to move Mustang units.
2021 cars 7.9%
2020 left overs 6.9%
Not that big of a deal as most buyers ad dealers have their own lenders.
But back in Feb to mid march 2020 left overs Ford offered 0.0% for 60
Not a fan of the headline on the Ford site when you enter the mustang part of it.
"one last lap" Who knows what that is projecting. But with the Other pony car rumors of 2022 being it's last. (again) . I was put back when that tag line came up on the Ford Gas powered mustang part of the site.
0.0% for 72 on the Exployer, but 7.9 on the pony car.
For giggles I looked at a few, 48-60k .
If the fed ever starts raising interest rates, it should be interesting how they are going to move units of 45-80k trucks and suv's.

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[Gregs24]

I hear you loud and clear. Unfortunately the majority of all chips are made in the Far East, with China being #1. We all now how that goes. But business is business and global corporations get first dibs. Other manufacturers were effected before Ford and some have not been effected at all. As far as manufacturing coming back to the US, forgetaboutit, that ship has long sailed. As the old saying goes it is what it is. And we can all agree it sucks.

Chip manufacturing is immensely expensive to setup as well as taking a long time. As you say that ship sailed long ago when you guys were still digging holes in the ground for coal and oil

Lot's of car makers suffering. JLR have just shutdown production for at least 2 weeks, Ford European plants are on short time or stopped.

The reality is you can't make 'everything at home' as some have said, as you simply don't have the materials to do it in any one location. Global supply chains are the way the world is now.

 

[Vlad Soare]

Besides, it's a toxic industry. You need a country with a very low focus on environment and health to make them at such a massive scale and at an affordable price.

 

[Gregs24]

The news is good at overstating facts, it’s what sells and gets everyone into a frenzy... and this applies to ALL news outlets.

It really isn't. These delays will apply for at least a year, on and off and some cars are simply not available to order - or at least you can order them, but no build date in site. Ford Kuga (Escape in US) - no build dates available from Valencia, likely 6 to 8 month wait. Similar for other models.

Audi will make 10,000 less cars in Q1 this year because of shortages they have reported

Globally there are predictions of 2.2 million cars less made this year

A few are in a better position - Toyota has stockpiled chips and predicts no drop in production.

 

[Gregs24]

Besides, it's a toxic industry. You need a country with a very low focus on environment and health to make them at such a massive scale and at an affordable price.

Is that why Romania is the largest producer of electronics in Central and Eastern Europe ?

 

[Vlad Soare]

Electronic modules are assembled in Romania, using imported components. That's a different story. We do not produce semiconductors.

 

[Rapid Red]

Take it for what it's worth, but here goes. Several years ago a computer managed inventory control, supply and demand. Became an algorithm, the idea product delivered "just in time". A seamless product production & delivery with limited inventory build up .

Everything ordered, made out to door to the customer. No one waits for what they want or need. The ultimate instant gratification, every body happy

I called that pipe dream, and what do we have today. Delayed production & product delivery to the point of total shutdowns. Work force suffering temporary layoffs, hopefully.

Cannot wait for the next tinfoil hat algorithm to come. Actually it is here, but it is political and shutting down freedom of speech for one, I could go on.

Rock on

 

[ctandc72]

I love the different perspectives / answers in this thread...

Ford, GM etc - those doing rolling shutdowns on certain auto plants / models (all these manufacturers will push to keep producing their most lucrative model lines - so F150 for Ford and Silverado for GM) are doing them because of the changes that the Auto Industry and many other industries have made in their supply chains over the last decade or so - longer in some cases.

You think Ford or GM would have gotten their chips if the plants had been here in the U.S? There ARE plants here in the U.S. - but this is on Ford, GM etc themselves.

They don't want to STOCK anything. They want an "on demand" supply chain. It's about profit margins. They don't want the overhead of stocking parts and components and this effects their suppliers. They bet on COVID negatively affecting new car sales - so they adjusted their projections and thus adjusted their supplies. They were wrong.

Normally that wouldn't be a big deal...........but there were TWO major plants that were damaged / destroyed by fire. One in Nov 2020 and one in March 2021.

Then add to the fact that plants productions were in many cases impacted by COVID - staffing, support, raw materials etc.

Now add in that consumer electronics demand which increased dramatically, because of COVID - you have a perfect storm.

And I'm not really sure what the U.S. (digging holes in the ground for oil and coal) has to do with chip shortages? Since late 2019 the U.S. was actually a net exporter of petroleum products - that's starting to change with the new administration and new policies.

Corporate tax rates and labor costs have a much bigger impact on where these plants are built.

 

[Zach@Granger]

I love Mustangs as much as the next guy. But this generation is an aged design and sales have decreased as this generation has aged. If you place a retail order, it shouldn't make a huge difference. It may slow down delivery if your order is in the shut down weeks obviously.

But Ford will prioritize hot moving products and high margins over low demand and lower margin. I'd expect to see less Ecosport, Escape Mustang vehicles and more F-Series, Bronco, etc.

 

[Bikeman315]

TSMC and Samsung are building new plants in the states. Intel will eventually get their shit together and move to a modern node. Probably.

Good news, I didn’t know this.

 

[Bikeman315]

Take it for what it's worth, but here goes. Several years ago a computer managed inventory control, supply and demand. Became an algorithm, the idea product delivered "just in time". A seamless product production & delivery with limited inventory build up .

Everything ordered, made out to door to the customer. No one waits for what they want or need. The ultimate instant gratification, every body happy

I called that pipe dream, and what do we have today. Delayed production & product delivery to the point of total shutdowns. Work force suffering temporary layoffs, hopefully.

Cannot wait for the next tinfoil hat algorithm to come. Actually it is here, but it is political and shutting down freedom of speech for one, I could go on.

Rock on

You have a lot to learn about JIT manufacturing. We used it at Panasonic back in the late eighties to reduce high inventory levels and reduce the cost of selling it off.

https://en.wikipedia.org/wiki/Just-in-time_manufacturing

 

[Bikeman315]

Yes, but the Arizona plant isn't expected to be online until 2024

https://www.notebookcheck.net/TSMC-...facturing-facilities-in-the-U-S.525937.0.html

As a result, it won't have any impact on the current shortage. It will help keep up with demand in the future.

Question though. Even if we had these plants here in the US today would they have had the materials to meet the current demand? Wouldn’t Ford still have been screwed as they cancelled their orders?

 

[Hack]

Many of you may also remember the news about Huawei, who were using semiconductor devices to spy. I don't know much about it, but I assume developments in China have made a tremendous impact on the semiconductor industry. At one time it seemed as though China was going to become a huge source for semiconductors with lots of multi-national companies investing there and more recently some of that may have changed. I'm purposely being vague here to avoid the political side of this.

There's also a lot of general upheaval and mergers happening in the semiconductor industry. A lot of it is due to intellectual property and the increasing complexity of chips. Companies are buying each other out so that they can get the needed IP to produce semiconductor devices that will be competitive in the market. I assume changes like that are going to temporarily reduce efficiencies and capacity.

 

[MIDLYFE]

Tough blow for the IC engines are "racist and evil" crowd.

 

[Hack]

Do you have hard evidence of this? I think the state department would like to debrief you, because major multi-department investigations have yet to uncover anything. Evidence was found that showed banking/wire-fraud and breaking of embargoes against Iran. That is certainly an issue, but it isn't espionage.

China's semiconductor industry is going to become increasingly insular, supplying only the needs of China. That’s how a lot of industry in China works. Companies outsource manufacturing to China. They steal the tech and designs, then manufacture the copies for sale domestically. No need to worry that a Chinese chip will report your breakfast habits to Beijing, they save that kind of stuff for their own citizens.

What upheaval are you talking about? Nvidia trying to buy ARM? That has nothing to do with any of this. Nvidia wants to break into the data center market, which is still relatively niche compared to total SoC consumption across all industries. ARM also isn't a manufacturer. They license their designs to other companies.

Hard evidence of what? I don't pretend to be an expert. I just mentioned what a number of news agencies reported and what government officials have been saying. I don't have a bias here. My work actually thought that they would be selling a lot of products to Huawei, and I know some people had to be disappointed when the order came and we had to stop those projects.

Mergers: like Analog Devices with Linear (14.8 billion) and Maxim (combined enterprises at $68 billion). How about Avago buying Broadcom (17 billion)? I don't know anything about Nvidia or ARM. I believe you when you say they are niche.

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