Ford Motor Company (NYSE:F) has fulfilled its commitments with UAW. The company will invest $1.45 billion in two plants at metro Detroit. Ford will manufacture autonomous, electric vehicles, Pickups, and SUVs at these new facilities. It will generate 3,000 jobs. The average annual wage for its employees will be equal to or over $61,047. Ford will enjoy tax benefits of over $35 million on the proposed investments at the two plants in Detroit.
Ford generates an additional 300 jobs
The company will also generate an additional 300 jobs by investing $700 million in the Dearborn-based truck plant. According to a communiqué on Tuesday, Ford will invest another $750 million in Wayne based Assembly plant and adds 2,700 jobs in the next three years. The investments are part of $6 billion promised commitments in a new contract signed with UAW. Ford has negotiated with UAW this fall and agreed to invest at nineteen facilities in the US and generate 8,500 new jobs.
Investments showcase strengths
President (Automotive Division) of Ford, Joe Hinrichs, said the investment at Michigan plant augurs well for the present and future. He further stated the company is expanding its leadership into autonomous and electric vehicles. The company is investing heavily, considering its strengths to build SUVs and trucks.
The drop of 4.9% in Ford vehicle sales
New vehicle sales in the US are at its peak and expect to level off at an annual rate of seventeen million vehicles. Ford reported sales of 580,251 vehicles in Q3 2019. It is a drop of 4.9% when compared to the same period last year. However, the company reported an increase in sales for the Lincoln brand and trucks. The company is focusing on profitable SUVs and trucks than cars.
To increase its market share, Ford needs to invest considerable amounts and adopt new vehicle technologies. Ford will invest $1.1 billion in its Wayne plant in four years to develop and build Ranger Pickup and Ford Bronco SUV. The company will produce electric and hybrid versions of the truck and new generation F-150 at its Dearborn facility. It will also use the funds for assembling batteries.
Recalls over 500,000 Super Duty Vehicles
Ford has recalled over 500,000 Super Duty Vehicles manufactured during 2017 and 2019 to prevent excessive sparks. The dealers will adjust the sound deadener and provide insulation to the carpet using foil tape. Frequent recalls affect the confidence of customers in Ford vehicles.