The generally agreed-upon early-May production restarts floated a couple of weeks ago were clearly not set in stone. Not for everyone, anyway. While Fiat Chrysler tossed its tentative May 4th restart to fall in line with the Detroit Three and placate the UAW, other automakers are reaching their own conclusion that earlier might not be better.
Count Toyota and Volkswagen among them.
May 4th is off the table for Toyota’s significant manufacturing footprint. The automaker said Wednesday that its North American factory operations are in for another week-long pause, coming back online on May 11th. The decision came after consultations with its supplier and logistics network.
Now, the company “intends to gradually resume its manufacturing operations in compliance with federal health and safety guidelines, and local and state ordinances where our facilities are located.”
It almost goes without saying that new health and safety protocols will be in place when workers return.
Volkswagen’s manufacturing presence pales in comparison to Toyota, but the company’s Chattanooga assembly plant will similarly remain offline for an additional amount of time. Exactly how long, VW isn’t saying.
Saying in Wednesday release that it has “reassessed” its plans, the automaker now claims Chattanooga will remain shuttered for an indefinite amount of time.
“Before setting a new start date, Volkswagen will weigh the readiness of the supplier base, as well as market demand and the status of the COVID-19 outbreak,” the company stated. “The Company will continue the work to start production from an organizational perspective, and refine and strengthen the health and safety measures to safeguard our employees.”
VW furloughed its production and maintenance employees on April 11th, with benefits continued past that point.
[Image: Steph Willems/TTAC]
Nissan Smyrna,Tn – “Due to the ongoing impact of the COVID-19 pandemic, Nissan has extended production downtime at all of its U.S. manufacturing facilities until mid-May”
https://www.dnj.com/story/news/2020/04/29/nissan-expects-auto-manufacturing-to-return-by-mid-may/3047743001/
What’s the hurry?
Are auto sales on May 18, or June 18 for that matter, going to return to where they were?
Are automakers going to hurry to restart so they can idle the plant after a month, as inventory builds?
They need to figure out many variables. DEMAND they must estimate. Then they must figure out how to work in a COVID-19-safe manner. To do that, they need to secure supplies of PPE (personal protective equipment, like masks, gloves, etc). And they must figure out how if they will reduce shifts or production rates.
But DEMAND is the biggie. Being able to build cars on May 17 that no one is buying is not an accomplishment.
Agreed. A slow restart should be adequate to meet demand, but demand estimates should be reasonable.
Horrible problem. Use up scarce supplies (which if they are like connectors, common parts, paints, could be used elsewhere) to produce vehicles that may or may not sell. Converting your cash into depreciating inventory, what a potential for disaster. Better to spend your time and money in SHIFTING inventory around the country so that you have what a customer wants and get cash into the till.
I see a very long model change shut down, like 2-3 months!
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