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Old 01-12-2005, 11:27   #1 (permalink)
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US:Ford's 3 new models hit delay on way to dealers

Ford's 3 new models hit delay on way to dealers

Company says its Chicago plant is making certain quality is right


BY JEFFREY McCRACKEN and JAMIE BUTTERS
FREE PRESS BUSINESS WRITERS



Ford Motor Co., which is counting heavily on the three new vehicles coming from its Chicago assembly plant, is having a problem getting them out of Chicago.


Many Ford dealers, consumers and auto experts contacted by the Free Press say it is taking months longer than expected for Ford to ship to customers three of its newest products, the Ford Five Hundred sedan, a Mercury version of the sedan called the Montego and the Ford Freestyle crossover wagon. The delay, which apparently stems from quality concerns, may be costing Ford some sales.


Ford says any delay is minor and that it is being extra cautious to ensure no quality defects get to buyers. The vehicles are crucial to Ford halting its sliding sales. Ford has had problems in the past with defects on vehicles like the Focus shortly after launching them.


"If we find any problems with the vehicles then we hold them. That problem is not going to get out to the customer, so that may affect the numbers of vehicles going to dealers," said Jim Tetreault, Ford's North American director of car manufacturing. "We are proud of what we've accomplished. We think we've balanced all the demands very well."


Ford began production on these three vehicles in mid-July with a plan for full production by September and dealers having plenty in stock by October.


Instead, it took two months longer than expected to get even close to full production. In September, Ford built 12,077 vehicles at the plant, or just 52 percent of its full capability. Ford got up to 84 percent in November, still well short of full production, say experts. The automaker has not released December production figures.


This lag means many dealers have far fewer vehicles than usual and some frustrated customers are waiting several months to get these new cars, such as the Five Hundred, which Ford executives call the brand's new flagship car.


The vehicles are available -- and some dealers have a full complement -- but most dealers contacted by the Free Press say they have far fewer vehicles than they were promised.


An online check of the inventory at Ford dealerships across metro Detroit and the rest of the country shows many dealers have fewer than 10 of the Five Hundreds or Freestyles in stock.


Martin (Hoot) McInerney, owner of Star Lincoln-Mercury in Southfield, among other dealerships, says he has four or five Montegos on the lot. If fully stocked, he would have 40 or 50 to meet customers' range of demands for specific colors and options.


McInerney says Ford told dealers they would not have a full stock of the vehicles until January.


"They haven't gotten production kicked up to where it should be," he said.


He said dealers would rather have the vehicles made well than have them sooner.


"They made a vow not to ship it out until they got it right," he said. "They didn't want to rush it."


He said production is complicated by the variety of the new models, including the combination of front- and all-wheel drive.


To get defect-free cars out to dealers more quickly, last week during what is normally a holiday plant shutdown, Ford had UAW workers at the Chicago plant repairing vehicles, according to a Ford official and others familiar with the plant who asked not to be named. Because it was a holiday week those workers likely were paid triple time for their hours.


Tetreault told the Free Press it "was very normal to have people in to manage these vehicles," during a holiday break. The Free Press was unable to reach the UAW chairman at the plant by late Wednesday.


Auto analysts said it is very inefficient and expensive to have workers repairing vehicles just as they roll off the assembly line.


"When you have to fix them before you even send them out, that's the worst. It says they can't produce a salable vehicle without making all sorts of repairs," said Catherine Madden, auto-production analyst for Global Insight, an auto-research firm.


A variety of quality problems seem to be the cause of the delays. For example, Ford had problems with the welds that hold the engine in place, but a person familiar with the plant's operations said that problem was fixed months ago and only delayed a few vehicles.


Customers and dealers told the Free Press other problems were related to heating and cooling systems in the three vehicles, which share a common basic structure.


Ford would not say what has delayed the vehicles. Tetreault said Ford "had some difficulties with some supplier components," but would not specify.


Auto experts said the delay was unusual, but gave Ford credit for catching any problems at the plant. They also said the delay was because Ford was trying to do so many new things in Chicago, such as put in a new transmission on new products in a redesigned plant.


"The ramp-up on these vehicles has been incredibly slow, and a lot of that is due to quality issues at the Chicago assembly plant," said Erich Merkle, senior auto analyst for IRN Inc., a Grand Rapids-based auto-research firm.


"I'm glad they are taking time to make sure quality issues don't get out to the customer, but at the same time you'd like to think they could get it right by now. July to now is a long period of time to still be struggling with these problems," said Merkle.


In the past few years, Ford has had troubles with launches of vehicles such as the Ford Focus, Thunderbird and Explorer, which had defects that made it out to customers and hurt Ford's reputation.


Bob Kain, general manager of Jack Kain Ford in Versailles, Ky., said many people want the Freestyle, but he has only one on the lot.


"We're at the mercy of Ford, at this point. We're just hoping we'll get them in as soon as we can," he said.


Until May, Chicago had been the home for the Ford Taurus and Mercury Sable. Ford invested about $400 million renovating the Chicago site.


While Ford resists any criticism of the launch, sales executives acknowledge that manufacturing glitches played a role in Ford missing its sales goals for those vehicles by 15 percent through December.


"We had a slower-than-anticipated production launch," Ford Division President Steve Lyons told journalists Tuesday.


Inventories are still thin, he said, noting that a big dealer might have only 15 or 20 Five Hundreds.


"We're used to lining up 100 Tauruses and having a sale," he said.


One Mercury Montego customer, Birmingham resident Charlotte Lally, said she put down a $200 deposit to order the vehicle in the summer and did not get it until Dec. 17. That's an unusually long time to wait for a new vehicle.


"I was getting frustrated by how long it took. I didn't expect to wait that long and I was nervous as it started to turn to winter," said Lally, who previously drove a Mercury Grand Marquis sedan.
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