Ford will halt all production of its popular F-Series pickup

Key Points
  • A fire knocked out production at one of Ford's suppliers.
  • The shortage of parts stopped production of Ford's best-selling and most profitable vehicle, the F-150 pickup truck.
Ford suspends F-150 production due to fire at parts supplier

With key components about to run out, Ford is pulling the plug on production of its most profitable and popular model, the F-150, late Wednesday evening.

The move means approximately 4,000 workers at Ford's Dearborn Truck Plant will be temporarily laid off, joining roughly 3,600 workers at Ford's truck plant in Kansas City who were told to stay home earlier this week.

"I think it's safe to say, we're going to see an impact over several days, but beyond that we can't say," said Joe Hinrichs, president of Ford global operations. "We will be down through the end of the week."

Both assembly plants are unable to continue building the F-150 pickup truck because of a lack of critical components supplied by Meridian Lightweight Technologies. An explosion and fire at Meridian's facility in Easton Rapids, Michigan, last Wednesday completely knocked out production of components used in the instrument panel of the F-150.

The components shortage has also prompted Ford to stop production of the F-Series Super Duty pickup at its production plant in Louisville, Kentucky.

In addition, Ford is working with the supplier to ensure it has enough key components to continue production of the Ford Expedition, Lincoln Navigator and Ford Explorer SUVs. For now, the automaker says final assembly of those SUVs is not changing.

How much could stopping production of the F-Series hurt Ford and dealers who rely on the popular pickup truck to generate huge sales? That depends on how long the assembly lines are shut down.

Ford admits near-term financial results will be adversely impacted by the loss of F-Series production, but the company reaffirmed its full year earnings guidance of $1.45 to $1.70 a share.

Meanwhile, F-Series sales should not be impacted for a while.

"It takes 76 days for an F-150 to sell, so the company does have a bit of a cushion," said Ivan Drury, Edmunds senior manager of industry analysis. "But when you have a vehicle that comprises a quarter of your company's sales, any production disruption is going to cause some consternation."

Last month Ford sold 73,104 F-Series pickups, with the overwhelming majority of those being the F-150 according to company sales reports. Meanwhile, the automaker ended April with nearly a quarter million trucks on the ground at dealerships, a high percentage were F-150 models.

That inventory will keep Ford dealers stocked for several weeks, though an extended halt to production could be problematic for the automaker and painful for more than 7,600 workers.