Ford to retool SUV plant for making small cars

07 May 2009

Ford announced on Tuesday that it will spend $550 million to convert its Michigan truck plant into a facility that will produce the Ford Focus compact, including a zero-emissions electric version of the Focus.

The Michigan Truck Plant in Wayne, west of Detroit, has long been known for producing Ford Bronco sport-utility vehicles and the classic Ford F-series pickup. For years, the Ford F-150 was America's best-selling vehicle and the metaphorical backbone of a working nation. The plant also produced the three-ton, 14-mile per gallon Lincoln Navigator and Ford Expedition - among the biggest SUVs on the road - 300-horsepower monsters built to tow powerboats and invite the ire of environmentalists.

Now however the facility - renamed the Michigan Assembly Plant - is retooling so it can build the 2,588-pound Focus, a 35-mpg fuel-sipper that pulls Ford's hopes with its little 140-horsepower engine. Those will begin rolling off the line in late 2010, and the electric Focus a year later.

The announcement is the next step of a process that was set in motion by Ford chief executive Alan R Mulally in July, when he said Ford would revamp the plant to produce one of Ford's small cars at the Michigan plant. So far, Ford has committed $75 million to the conversion.

Ford is the only one of the Big Three US automakers that has not asked for anything from the $25 billion approved by Congress last fall to help the US Big three retool to make more fuel-efficient vehicles. However, Ford, the second-largest US automaker, is receiving $159 million in state tax incentives and $15.3 million in municipal tax abatements from the government.

At its peak in the 1990s, the Michigan Truck Plant had three shifts working around the clock to produce the highly profitable SUVs, which allowed Detroit's Big Three to ignore innovation on small cars.