CHICAGO –Motor Co. confirms it will idle its Chicago assembly plant, along with offering sales incentives, to prevent a stockpile of Five Hundred sedans before the car undergoes a name change to Taurus in May.
U.S. Sales Analyst George Pipas says downtime is planned, but he declines to indicate how many weeks the plant will be shut down in order to keep supply of the outgoing Five Hundred, Ford Freestyle and Mercury Montego models to a minimum.
The vehicles get a refreshing for ’08, along with the name changes that will see the Freestyle become the Taurus X and the Montego change to the Sable to coincide with the Five Hundred’s switch to Taurus.
“We have several down weeks in our production schedule; I just can’t say how many specifically,” Pipas says. “We don’t want excessive inventories of the (’07) vehicles because they’ll be obsolete not only in terms of the name changes, but also by the fact the ’08s have new front and rear end styling, new more powerful V-6 engines and more standard safety equipment, like side airbag curtains.”
Sales of the Five Hundred plunged 50.8% from year-ago to 3,526 units in January, and Freestyle demand slid 57.5% to 2,011. Montego sales fell 40.1% to 1,190.
Ford dealers long have complained the Chicago-built trio sells well when promoted but that in the last year the auto maker has put little money into marketing the vehicles.
Dealers expect current incentives set to expire Feb. 28 – $2,000 cash or 1.9% financing on 60-month loans – to be extended, but so far Ford has remained mum.
“It’s in the best interests of our company, our dealers and our customers to have lean inventories of the outgoing models, or else we’d be fighting against ourselves when the new ones went on sale,” Pipas says.
Ford doesn’t want dealers to be forced into pitting the old nameplate against the new, with the old one carrying hefty incentives to attract buyers or, once the old ones are finally gone, with steep incentives to get the new ones moving.
Other than incentives, the only other option for keeping the plant operating at normal capacity again would be to dump vehicles on rental fleet customers at heavily discounted prices, and Ford insists it has no intention of doing that.
“This is something we can control with cautious production scheduling,” Pipas says. “The goal is stable operation at the plant as we move forward with Taurus and Sable. It will mean some large year-to-year sales declines in the Five Hundred and Montego until the Taurus and Sable come out, but that’s something we have to live with.”
A Ford spokeswoman says there are no current plans to move up ’08 Taurus/Sable production any sooner than the original Job One target in May.