More than 100 car and engine plants across North America will cease production after General Motors, Ford and Fiat Chrysler Automobiles agreed co-ordinated wind-downs and Honda and Toyota announced blanket closures, in an unprecedented continent-wide shutdown to tackle coronavirus.
The deal between the “Detroit Three” to halt all manufacturing until the end of the month comes hours after additional plant closures across Europe brought the continent’s auto industry to a near-total standstill.
Wednesday’s historic agreement ends a five-day stand-off with the United Auto Workers union, which has been pushing GM, Ford and FCA to shut facilities to protect workers from the growing outbreaks of the disease.
Hours before the deal, Honda announced a shutdown of its 12 North American sites, as well as its UK facility in Swindon, citing a drop in demand. Toyota also plans to shut its North American plants for two days next week, though currently intends to restart production next Wednesday. Tyre supplier Goodyear followed the automakers late on Wednesday, saying it would close factories in North and South America until at least April 3.
The virus has closed all but a smattering of European plants, as consumers across Italy and in other countries are unable to buy new vehicles, and carmakers face serious disruption to their supply lines and workforces.
BMW and Toyota on Wednesday closed factories across Europe. Jaguar Land Rover, the only large carmaker with multiple sites still open across Europe, is expected to follow suit as early as Thursday.
Ford said it would close plants in the US, Mexico and Canada after Thursday evening shifts until March 30 to sanitise the facilities. The company plans to work with the union to increase social distancing between employees, particularly during shift changes when workers congregate at exits.
“Today’s action is the prudent thing to do,” said Kumar Galhotra, Ford’s president of North America, adding that the industry is experiencing “unprecedented times”.
GM chief executive Mary Barra said that recent developments “make it clear this is the right thing to do now.” Once March is over, GM said it would review its production “week-by-week”, she added.
FCA chief executive Mike Manley said: “Working with the UAW, and having visited many of our plants yesterday, we need to ensure employees feel safe at work and that we are taking every step possible to protect them. We will continue to do what is right for our people through this period of uncertainty.”
“UAW members, their families and our communities will benefit from today’s announcement with the certainty that we are doing all that we can to protect our health and safety during this pandemic,” the union’s chairman, Rory Gamble, said.
The shutdowns “give us time to review best practices and to prevent the spread of this disease”, he added.
Jessica Caldwell at data group Edmunds said: “This is a seismic move by the Detroit Three.”
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The UAW first proposed a fortnight’s shutdown on Sunday in a newly formed task force between the three carmakers and union officials to tackle the outbreak.
Union leaders said closures were needed to protect members, who have to come into work while back-office staff are able to work from home.
Several plants, including Fiat Chrysler's Sterling Heights factory in Michigan, have been closed following confirmed cases of the virus among staff. Staff walkouts over virus concerns have also forced temporary stops at several plants.
An initial agreement between the union and the carmakers on Tuesday evening for “rotating, partial shutdowns” would have cut shifts to allow deep cleaning, but still required workers to attend. That, however, was widely panned on social media by staff who said it did not go far enough.
Are you seeing job cuts happen in your workplace or others? Is your company discussing changes in pay or benefits? Tell us what you’re seeing. Send tips and stories to coronavirus@ft.com.
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March 19, 2020 at 06:55AM
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Ford, General Motors and Fiat Chrysler agree widespread shutdown - Financial Times
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