Ford investing $1 billion, adding jobs at Chicago factories as it makes cuts overseas

Key Points
  • Ford is investing about $1 billion in assembly and stamping plants in Chicago.
  • The automaker is expanding production of the new Ford Explorer, Lincoln Aviator, and Police Interceptor.
A worker assembles a 2011 Ford Motor Co. Explorer at a plant in Chicago, Illinois, U.S., on Wednesday, Dec. 1, 2010.
Tim Boyle | Bloomberg | Getty Images

Ford is sinking $1 billion and adding more jobs to plants in the Chicago area to expand production of the redesigned Ford Explorer and Lincoln Aviator sport utility vehicles.

The expansion comes as the automaker makes cuts overseas and shifts its lineup to make more SUVs, crossover-utility vehicles and trucks and away from sedans and sports cars, which have fallen out of favor with American drivers.

The move will add 500 jobs at Ford's Chicago-area Assembly and Stamping plants, bringing the total number of employees at the two factories to 5,800, the company said Thursday. Ford is building a new body shop and paint shop at the assembly plants and plans to make major changes to the final assembly area. The company also plans to install some new manufacturing technology, including 3D-printing tools and robots.

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It's also spending $40 million to upgrade the facilities for employees, including new LED lighting and cafeteria updates, new break areas as well as parking lot security upgrades.

In addition to the Explorer and Aviator, the plants make Ford's Police Interceptor, an SUV modeled on the Explorer.

Ford is undergoing an $11 billion restructuring that will shrink its salaried workforce of 70,000. It is also cutting thousands of jobs in Europe, where Ford has struggled to maintain solid footing.

Ford is not the only automaker that has had to reshape its business in the face of a changing industry. Rival General Motors is in the process of cutting production at plants in the United States and Canada as part of its own turnaround plan.

GM has been faced with underutilized factory capacity in plants that had heavily focused on building less popular sedans and compact cars. GM said it has offered jobs to hundreds of hourly workers at new plants building vehicles in growing segments, such as SUVs and crossovers.

Joe Hinrichs, Ford president of global operations, speaks with Chicago Mayor Rahm Emanuel after the automaker announced it was investing $1 billion in Chicago area factories.
Paul Eisenstein/CNBC