Ford Motor Co. has confirmed plans to cut production and temporarily lay off more UAW members at the Chicago Assembly Plant.
A UAW local official at the huge Illinois factory had urged workers to be careful with their money and prepare for the wage loss caused by a global supply chain problem, the Free Press first reported Thursday. The shortage is tied to manufacturing disruption worldwide because of COVID-19.
This latest confirmation from the Dearborn automaker now officially totals four states with layoffs or shift reductions triggered by a shortage in semiconductor chips:
—Dearborn Assembly Plant, which makes the F-150 pickup.
—Kansas City Assembly Plant, which makes the F-150
—Louisville Assembly Plant, which makes the Ford Escape and Lincoln Corsair
—Chicago Assembly Plant, which makes the Explorer, Police Interceptor and Lincoln Aviator
At the Chicago Assembly Plant, two shifts will be laid off next week, said Kelli Felker, Ford global manufacturing and labor communications manager. The plant, which employs 5,300 hourly workers, will go down to one shift.
When the Free Press reported news of the Chicago situation on Thursday, Ford said the decision wasn't final yet. It is now.
A letter circulated among Chicago Assembly workers signed by UAW Local 551 Chairman Coby Millender said the plant had been able so far to avoid shutdown but the situation became dire.
"The company has informed us that beginning next week, they want to have B and C crew laid off initially for one week with a strong potential for additional weeks. It's totally based on how soon the supplier resolves this issue," Millender wrote. "I just wanted to make you aware 551, so that you can begin to plan accordingly. Be wise with your finances."
Laid-off UAW members will get about 75% of their gross pay, which is part of the labor contract.
Ohio layoffs
Meanwhile, Ford plans to cut hours at the Ohio Assembly Plant, which makes the Ford F-650 and F-750 trucks in addition to the F-350/450/550 Super Duty Chassis Cab, E-Series Cutaway and Stripped Chassis. These cuts are unrelated to the parts shortage, Felker said.
Ford disclosed that 300 of its 1,800 hourly workers who build the F-650 and F-750 trucks at the plant in Sheffield west of Cleveland were laid off the first two weeks of January and will again be laid off the first and last weeks of February with shift reductions mid-month.
“We are matching production to customer demand," Felker said. "We expect this line to be running full production again beginning March 1."
The big trucks are often purchased for commercial use by landscaping companies, home builders, utility companies, rental companies such as U-Haul and towing services.
US workers
This shortage of semiconductor chips is affecting auto production globally because chips are used for automation, electrification, digital connectivity and security — everything from computer management of the engine to driver-assistance such as emergency braking. There is also stiff competition for the product from outside computer manufacturers.
The auto industry pulled back chip orders last year amid the pandemic and the production recovery for vehicles has been much stronger than initially considered, said Kristin Dziczek, vice president of Industry, Labor & Economics at the Center for Automotive Research in Ann Arbor.
"The lead time on chips is pretty long,” she said. “It’s not easy to turn back on a dime.”
'Trying times'
Behind the scenes, automakers and factory workers say anxiety is growing amid increased uncertainty.
"These are just trying times, and we all need to be patient and smarter going forward. Hopefully, it is only for one week. I am very doubtful," said a Ford UAW member in Chicago who was not authorized to speak to the news media. "If 2008/2020 taught us anything, it's don't have your eggs in one basket. Unfortunately, you can't depend on the automotive industry to think to the future. Reducing our orders on semiconductors wasn't bright, at all."
Ford employs more hourly American autoworkers than any other company. It assembles more vehicles in the U.S. than any other auto manufacturer.
Stellantis OK for now
At Stellantis, formerly Fiat Chrysler Automobiles, the company cuts to production in Mexico and Canada during January will keep the company from making further trims in the U.S. in February.
“Our North American facilities will be running in February," said Kaileen Connelly, a company spokeswoman. "We continue to work closely with our global supply chain network to monitor the industry-wide issue."
General Motors has said it is monitoring the supply chain crisis carefully and, to date, is not affected by the situation.
