“Just look around and you’ll see an amazing story. … Companies are choosing to build new factories here, when just a few years ago, they would have built them overseas,” President Biden crowed in his State of the Union address earlier this year.
This morning I looked around and was greeted with this Reuters headline:
The announced opening, coming just one week before the election, makes clear that Ford CEO Jim Farley has the same low regard for Biden as he does for Michigan Gov. Gretchen Whitmer, who Ford has previously played for a fool, among other Michigan leaders. The announcement also underscores how Ford is singing a very different tune with Biden running than country than when Donald Trump was in charge.
In January 2017, Ford cancelled plans to a build a small-car assembly plant in Mexico that Trump repeatedly criticized. Just hours earlier, Trump threatened to impose tariffs on cars made in Mexico by General Motors.
“We are encouraged by the pro-growth plans that President-elect Trump and the new Congress indicate they will pursue,” Mark Fields, Ford’s chief executive at the time, was quoted in the New York Times as saying. The Times said Fields “made clear” that Trump’s emphasis on tax changes and cutting regulations would have an overall positive effect on automakers such as Ford.
“We have a president-elect who has said very clearly that one of his first priorities is to grow the economy,” Fields said. “That should be music to our ears.”
The expansive Mexican engineering facility indicates Ford is looking to further increase the percentage of its workforce outside the U.S. According to this August CNBC story, only 49 percent of Ford’s global workforce of 186,769 employees were in the U.S. at the end of 2021. Ford in September of last year announced it planned to “significantly expand” its 11,000-employee Business Solutions team in India to focus on “engineering, technology, and business operations centers of excellence.”
Reuters characterized Ford’s Mexican campus as the company’s “new global technology and business center,” located on the outskirts of Mexico City. The new campus will host business operations, global transformation activities, and the largest engineering center in Mexico, Reuters reported. Ford posted details of the project on the company’s Twitter account.
Ford increasingly has relied on Mexican-based engineers for the design of its more popular vehicles, several of which are assembled in Mexico, including its electric Mustang Mach-E. The trade publication Ford Authority reported in June that the automaker’s engineering operations in Mexico, the largest in Latin America, experienced a 900 percent growth in personnel from 2010-2022. The publication said Mexican engineers were “significantly involved” with the Ford Bronco Sport, with Ford saying that over 70 percent of its engineering took place in Mexico. Additionally, the compact off-road oriented crossover is manufactured at Ford’s Hermosillo Assembly plant.
“Ford Mexico’s Engineering Center has evolved so much in recent years that we have become a fundamental arm for the company’s global projects,” said Marcos Pérez, director Product Development at Ford of Mexico. “For many years, we thought that Mexican talent was mainly related to manufacturing, but today, we have shown that we are equally or more valuable (emphasis mine) than the design engineers in countries like Germany, Australia or the United States.”
Ford of Mexico was recently ranked as the ninth best company for young professionals to work. According to Ford Authority, the automaker has “placed a big focus on hiring young and upcoming talent over the past couple of years.”
In the U.S., Ford has been looking to shed its experienced talent, and has been subject to multiple successful lawsuits for age discrimination. Emails obtained in one of those lawsuits revealed that Ford once hired Boston Consulting Group to identify employees whose exit would provide the greatest cost savings; BCG utilized an algorithm that included employee birthdates and number of years employees had worked at the company.
Fired employees included those workers with flawless performance records who had been promoted, rewarded and cited for excellence but were then deemed expendable because of their age and proximity to key retirement milestones.
Some believe that Ford’s serious safety and reliability issues stem from replacing experienced engineers with newbies. Ford this year has issued more than 50 recalls.
“I suspect a large part of the (recall) problem is that (Ford) bought out or forced out older more experienced engineers for young ones, Jerry Decker, a financial analyst from Queens who drives a 2019 F-150, told the Detroit Free Press. “And now the young ones are making the same mistakes the older ones did when they were young…How in the hell can (Ford) not figure out why their $100,000 SUVs keep burning up? Please ask Ford management how they plan to stop the recalls and if they plan to in some way get their more experienced engineers involved?”
Decker made his comment in June, when the Free Press quoted him as saying he owned “thousands of shares of Ford stock.”
Ford’s Farley is always playing to Wall Street, whose support he needs to drive up the price of the company’s stock and his hefty compensation, which in 2021 amounted to $23 million.
Ford earlier this week leaked to the Wall Street Journal that it has initiated a “performance enhancement” program for workers with eight or more years of employment.” Under the plan, workers who are notified that they are deemed underperformers will be given an opportunity for a generous severance if they voluntarily terminate themselves and skip the probation process. Targeted workers who choose to gamble and try to improve their performances but fail won’t get the generous severance package.
Pardon my skepticism, but given Ford’s history of age discrimination, the plan strikes me as an HR maneuver to lay off more experienced employees while minimizing lawsuit risks. Why else is the company only targeting U.S. employees with eight years of experience or more.
Meanwhile, Ford continues to suffer a steady string of legal defeats. A St. Louis jury ruled today that Ford and other companies must pay $6 million to a Missouri family over claims that a woman’s death was caused by exposure to asbestos, including from dust generated during brake repairs, ABC News reported.
Lawyers for the family said Ford failed to provide warning that asbestos was present in dust created during repairs of vehicle brakes. Ford attorneys said the exposure to the dust was limited and the family failed to prove it contributed to her illness. The company plans to appeal the verdict.
In another case heard in St. Louis in March, a jury awarded $20 million to a St. Louis County man who sued Ford. William Trokey claimed exposure to asbestos while fixing Ford brakes as a gas station mechanic in the 1960s led to his mesothelioma. Ford appealed that verdict as well.
A Georgia jury in August issued a $1.7 billion verdict against Ford after being presented with evidence the company knowingly sold Super Duty trucks with shoddy roofs that killed a couple. A Michigan jury last week ruled that Ford knowingly infringed on a software company’s patents. Ford earlier this year reached a multistate settlement to settle allegations that for years it deliberately made false advertising claims.
Ford said it will appeal the Georgia and patent verdicts. . A rundown of some of the other lawsuits filed against Ford can be found here.
Despite all its recalls and mounting legal troubles, Ford’s Farley continues to garner fawning media coverage, and is frequently portrayed as a formidable threat to Elon Musk on the EV front.
Me quito el sombrero ante usted, Sr. Farley. Sabe cómo engañar a los periodistas.