Summary
As competitors cut output to match weak sales, Ford is revving up North American vehicle production in the third quarter.
Analysis
Ford said last week that it plans to boost vehicle production 16% from the year-ago quarter, the company's first year-over-year quarterly production increase in two years.
Except for a flat Toyota Motor Corp., other major carmakers are cutting production substantially. After surpassing GM in the second quarter as North America's largest producer of vehicles, Ford continues to put distance between it and its financially troubled Detroit competitors.
A year ago in the third quarter, each of the Detroit 3 produced more vehicles in North America than did any import. But Chrysler's projected cut of 40.6% in the third quarter, combined with Toyota's cut of less than 1% and Honda's cut of 27.1% would drop Chrysler into fifth place.
Ford says it will increase third quarter production to 485,000 vehicles, up 67,000 from a year ago. The figure includes 25,000 units that Ford recently added as demand for certain vehicles accelerated.
Ford's inventory stood at 58 days' supply on June 1, below the benchmark of 60 days. GM had a 90 day supply at the end of June. Chrysler's inventory stands at about 86 days.
In contrast to Ford, bankrupt GM plans to continue rolling shutdowns that will cut production 49.3% in the third quarter.
Last month Ford posted the lowest sales decline of any major automaker, down just 10.7% from June 2008.
Toyota is expected to benefit form shutdowns in the first two quarters by dropping less than 1% in the third quarter. Honda and Nissan, still feeling the the pinch from declining truck sales will be down about 27% in the third quarter.
