Ford Announces C$700 Million Investment For Oakville Assembly In Ontario

Ford Motor Company has announced plans to invest C$700 million ($679 million USD) into its Oakville Assembly plant in Ontario, Canada to expand production capacity to meet surging global demand. The investment secures over 2,800 jobs at the facility, which currently manufactures the Ford Edge/Lincoln MKX and Ford Flex/Lincoln MKT.

The investment and resulting improvements — which will be completed by fall of 2014 — will position Oakville “as one of the most competitive and important facilities in the Ford system”, according to Ford president of The Americas Joe Hinrichs. “Global fuel-efficient products, built in a state-of-the-art facility, by a great workforce are a win for everyone today.”

Hinrichs added that the plant will begin production of several new global models that will help to meet demand in North America and around the world following The Blue Oval’s formula of offering vehicles with best-in-class quality, fuel efficiency, smart design and value. Hinrichs added that Ford’s investment will result in an increase in spending on Canadian-made auto parts by about C$200 million, bringing the total to roughly C$4 billion annually.

The improvements to Oakville Assembly represent Ford’s latest move to maximize existing North American manufacturing assets. As North American sales grow to pre-recession levels, being able to closely and effectively match production to consumer demand is vitally important for the automaker. So far in 2013, sales of the Ford Edge midsize crossover in the United States — the CUV’s biggest market — are on track to beat the prior record of 130,000 units, which was set in 2007.

The upgrades at Oakville will allow Ford to shift production based on consumer demand and buying habits more quickly and efficiently, and without having to idle a plant. The plant will be equipped with the ability to align capacity of any one vehicle with real demand for Ford customers in North America and all over the world.

“Flexible manufacturing enables us to get vehicles to consumers faster than ever before”, said Hinrichs.

The investment will also result in an increase in sustainability and fuel efficiency research and development capacity in Ontario. The effort will support studies in vehicle light-weighting, the reduction of stationary emissions from industrial facilities, as well as maintain research into advanced engine development at Ford’s powertrain research facilities in Windsor.

Taking this investment into account, Ford’s total Canadian investment stands at C$2 billion in less than a decade. In 2004, the automaker announced a C$1 billion investment for Oakville Assembly to introduce flexible manufacturing to the facility. And in 2010, the company announced a C$590 million investment into the Essex Engine Plant in Windsor.

Notably, investment in auto manufacturing directly benefits the Canadian economy, with estimates being that every auto job generates up to 10 supporting jobs.

The Motrolix Take

It’s about time that Oakville got the global treatment, as the global products that the upgraded will likely build include the all-new Ford Edge and Lincoln MKX that are due around 2015. The Edge will finally be a truly global vehicle riding on a variant of Ford’s new CD4 platform shared with the 2013 Fusion. However, it seems that the future of the Ford Flex and Lincoln MKT are currently up in the air.

Motrolix Founder with a passion for global automotive business strategy.

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