Automakers are temporarily closing factories in the U.S. amidst the coronavirus outbreak.
On March 18, Ford (F) - Get Report announced it was halting production at its U.S., Canadian, and Mexican manufacturing facilities to help boost coronavirus containment efforts. The suspension will last until at least March 30. Ford, which has 55,000 United Auto Workers employees, said those with at least 1 year of service would receive 75% of their regular pay.
Ford has also suspended its dividend, withdrawn its financial guidance to investors and offered payment relief to some new-car buyers in an effort to contend with the effects of the coronavirus pandemic.
“GM and the UAW have always put the health and safety of the people entering GM plants first, and we have agreed to a systematic, orderly suspension of production to aid in fighting COVID-19/coronavirus," said GM Chairman and CEO Mary Barra.
“…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," said FCA CEO Mike Manley.
Nissan is suspending production of its U.S. manufacturing facilities through April 6.
Elon Musk’s Tesla (TSLA) - Get Report announced it will temporarily suspend production at its Fremont, California factory at the end of the day on March 23. However, operations at some of its other facilities will continue, according to a March 19 press release.
Tesla, GM, and Ford have offered to make hospital ventilators in auto factories that have been shut down. Ford also is exploring the possibility of making medical equipment at its plants, according to reports.
Auto sales have been slowing since the coronavirus outbreak began. In the coming weeks and month, the entire industry will continue to be hindered by the coronavirus pandemic.
According to the Bureau of Labor Statistics, over 1 million people are employed in automobile and auto parts manufacturing in the U.S. 1.3 million people work for auto dealerships.
In Europe, Daimler, Ford Motor, Nissan, Volkswagen and most other major carmakers have temporarily closed their factories.
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