Ford Motor Co. is poised to add hundreds of U.S. jobs to increase production of its unexpectedly popular EcoBoost engines.
To do so, Ford is preparing to invest hundreds of millions of dollars in two Ohio plants as part of its 2011 commitment with the United Auto Workers to add 12,000 hourly jobs at U.S. factories.
The Dearborn automaker, which in 2009 introduced the EcoBoost series ? a marriage of turbocharging, direct-injection and twin independent variable-camshaft timing ? is in need of additional engines for high-volume vehicles like the Fusion midsize sedan and F-150 pickup. Buyers increasingly have opted for the EcoBoost engines which offer boosts in fuel efficiency and performance but command a premium of about $1,000.
"I think the supply is basically against the wall, based on demand," said Jeff Schuster, senior vice president at Troy-based research firm LMC Automotive. "As the EcoBoost technology and brand itself catches on, it is what's driving these types of decisions."
Ford won't publicly speculate on future investments, but the company's goals are clear: In lieu of more fuel-efficient but expensive diesel engines ? and until hybrids and electrics catch on, if they ever do ? the power and fuel efficiency of EcoBoost remains the chosen path.
So far, it's worked: Ford has sold more than 530,000 EcoBoost engines in the U.S. during the past three-and-a-half years through January.
"I don't know if there is (a ceiling), really," said Jesse Toprak, vice president of industry analysis at TrueCar. "The biggest challenge with these engines are the larger vehicles, and they've passed that test already with the F-150."
Ford's 2-liter EcoBoost is one of five powertrain options for Fusion, a high-volume vehicle in the ultra-competitive midsize segment; the 2-liter is also an option on the Escape SUV, Taurus full-size sedan, and Edge and Explorer SUVs. It is the only powertrain offered for the sporty Focus ST.
The 2-liter could eventually rival the automaker's 3.5-liter EcoBoost V-6 as the most popular of the engines sold in the U.S. The inline four-cylinder 2-liter is currently made only in Valencia, Spain. But Ford is planning to expand production at its Cleveland Engine Plant in Ohio.
The hundreds of jobs expected at the Cleveland plant ? which currently produces the 3.5-liter EcoBoost V-6 ? are contingent on a majority approval of a local UAW agreement. The local union is expected to vote in favor of the agreement beginning Monday. The jobs would be welcome in northeast Ohio: Ford in recent years closed an engine plant and a casting plant in the area.
Plans for Europe will create even more demand for the 2-liter EcoBoost: Ford wants to triple production of European vehicles equipped with EcoBoost engines by 2015 to approximately 480,000. Production in Ohio would allow Ford to better adjust for EcoBoost demand in two regions, analysts say.
"If you're in the region, it's much easier to adjust production schedules accordingly," Schuster said.
Another investment, outlined in the 2011 UAW contract but not expected to bear fruit until next year, is a $400 million revamping of Ford's Lima Engine Plant in Ohio. Lima Engine currently produces 3.5- and 3.7-liter engines. It is slated to receive production of "a new industry-leading small V6," according to the contract.
Ford in January announced a smaller-displacement six-cylinder EcoBoost engine for its next-generation F-150. The truck is expected for the 2015 model year.
Ford's North American success with EcoBoost engines is best summed up by the F-150: When Ford decided to offer a 3.5-liter EcoBoost V-6 for the pickup in model year 2011, company expectations were low. Ford now sells more EcoBoost-equipped F-150s each month ? about 42 percent of all F-150 sales ? than it anticipated selling in a year.
To date, U.S. truck customers have bought nearly 280,000 EcoBoost-equipped F-150s. And some inside Ford are adamant the automaker could sell even more, should production of the engines increase.
khenkel@detroitnews.com
(313) 222-2504
Source: http://www.detroitnews.com/article/20130216/AUTO0102/302160333/1148/rss25
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