Ford hopes that a sizable investment in a new assembly plant will drive down costs over the long term. If the company's plan proves effective, it could modernize vehicle assembly more than 100 years after the original method was introduced.
What Is Ford Planning to Do?
Ford intends to replace the traditional rolling assembly line with a tree-based system that builds vehicles from the ground up. The change should reduce the number of parts used and speed manufacturing. Ford estimates it could save up to 20% on parts and cut overhead significantly by reducing the labor and time needed to assemble its SUVs and trucks.
The Goal Is to Compete With China
By overhauling the assembly process, Ford aims to lower costs enough to compete with manufacturers in China and other countries. Foreign firms often have an edge thanks to different wage and regulatory environments, enabling quicker production at a lower cost. Streamlining manufacturing could allow Ford to continue producing in the U.S. while remaining competitive worldwide.
America Gets a Boost Too
Building cars domestically also benefits the national economy. A plant boosts the local area because businesses nearby gain customers with more disposable income. While exclusive U.S. manufacturing is unlikely, Ford hopes the investment will strengthen confidence in the stability of American manufacturing.
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