Makers mull best path to reopening
Automakers are cautiously coalescing around plans to reopen North American assembly plants early next month following what will be a roughly six- week shutdown for virtually the entire industry.
Toyota Motor Corp., Tesla Inc., Hyundai Motor Co. and Volkswagen AG are among the major automakers that have said they intend to resume production in the first week of May. Even if they stick to that schedule, many won’t restart all their factories at once, and the facilities that do restore output will run assembly lines at slower rates than they did pre-shutdown.
The non- unionized carmakers’ intentions add to the urgency of talks General Motors Co., Ford Motor Co. and Fiat Chrysler Automobiles NV are having with the United Auto Workers that weigh the need to get back to business against the possibility that reopening will sicken employees. Of the three, only Fiat Chrysler is confirming plans to progressively restart beginning May 4, pending approval from governments and unions.
“A lot of automakers are looking at some point in May starting production for at least half or a majority” of their plants, prioritizing those making lucrative pickups and SUVS, said Jeff Aznavorian, president of Clips & Clamps Industries, a supplier to Fiat Chrysler and other manufacturers. “All of them are planning on staggering those openings to make sure their processes are in place so they can go back to work safely.”
Weeks ago, analysts assumed there would be little reason for the industry to rush its restart. Sales in China plummeted almost 80 per cent in the wake of the country’s coronavirus outbreak early this year, and some were expecting a decline of similar magnitude for the U. S. Yet demand has held up better than expected, with researchers LMC Automotive and J. D. Power predicting a roughly 50 per cent decline this month.
“We’re confident, we’re ready to go with the proper safety protocols in place,” Gerald Johnson, GM’S executive vice president of global manufacturing, said in an interview Thursday. “We surveyed our supply base. They are as committed as we are. They’re as ready to start as we are.”
While the UAW likely won’t want to put its companies at a competitive disadvantage or keep its members from earning bigger paycheques again, the union also is leery of reopening plants too soon after two dozen union workers at Ford, GM and Fiat Chrysler have died of COVID-19 complications.
“The one thing that is a priority of all parties is the health and safety of UAW Ford, General Motors and FCA employees, their families and their communities,” Rory Gamble, the union’s president, said in a late Wednesday statement.