Ford delays two new electric vehicles, affecting Oakville plant
The rumor was circulating last week, but Ford officially confirmed the news via press release. The manufacturer has decided to review its electrification plan and delay the production of two new electric vehicles, namely a second van and an electric SUV with 3 rows of seats.
Ford is not the only one to review its plans. In fact, we learned last week that Nissan will do the same. Stellantis is also juggling the idea of bringing back a gasoline version of its Fiat 500 which has lost significant sales since it was only offered in an electric version. Some manufacturers dedicated to electric vehicles are in financial difficulties, this is the case of Fisker and Rivian.
Focus on hybrid engines
Ford continues to focus on electrification, but the manufacturer has decided to redirect its financial resources towards the development of at least one hybrid powertrain for each gasoline vehicle in its range. Ford made this decision at a time when the electric vehicle market has plateaued and even experienced a decline in demand around the world. Not only have sales of mass-market vehicles slowed, but so have all more expensive models. According to JD Power, people are tired of paying high monthly payments, especially with today’s interest rates.
“As the second-largest electric vehicle brand in the United States for two years, we are committed to growing a profitable electric vehicle business, using capital wisely and bringing the right gasoline, hybrid and fully electric vehicles to market at the right time,” said Jim Farley, Ford president and CEO.
An impact on the Canadian Oakville factory
The announcement is not without concern for the unions of theOakville Ford Plant, in Ontario. Ford mentions in its press release that the company is reiterating its commitment to its Oakville assembly plant, but is postponing the start of production of its 3-row electric SUV until 2027. The new production line is initially expected to start in 2025, while production of the Ford Edge ends this quarter as it bows out for 2025.
There will, of course, be repercussions for employees. They were to receive 70% of their salary during the closure period, the time to adapt the assembly line, but union leaders wonder if this agreement will be renewed until activities resume in 2027. The sub-contractors Dealers and parts suppliers also received the news very poorly; the decision will certainly affect their profitability.
Ford’s Oakville plant opened in 1953 and produced many models: the Ford LTD in the 1970s, the Mercury Lynx in the 1980s, the Ford Windstar in the 1990s and, more recently, the Lincoln Nautilus and Ford Edge.
