Strategic Capacity Planning

Ford Slows Battery Expansion for EV Market

A myriad of challenges—both external and internal—are leading automotive giant Ford Motor Company to delay construction of its second electric vehicle (VH) battery plant in Kentucky.

Ford has previously announced two large-scale EV battery plants in Kentucky, with start date of 2025 and 2026, respectively. The first Kentucky EV battery plant is on schedule, but the second plant’s opening is now pushed out with no specific start date.

“Given the dynamic EV environment, we are being judicious about our production and adjusting […]

By James Kirby Easterling|2023-12-06T06:45:24+00:00December 6, 2023|Tags: capacity management, downstream suppliers, efficiency, expansion, forecasting, prediction, supplier relationship, upstream suppliers|

UAW Deal Raises Ford’s Breakeven Point

To end strikes in its biggest factories, Ford entered into a tentative agreement with the United Auto Workers Union to increase the wages of its 57,000 workers by 25% in the next four and a half years.

The increase in wages will add $850 to $900 labor cost per vehicle. Ford faces a challenging task in balancing vehicle price, margin, and demand while remaining competitive relative to non-unionized automakers such as Tesla.

Video Spotlight:

Ford will delay […]

By Anita Lee-Post, Ph.D.|2023-12-03T03:39:22+00:00December 3, 2023|Tags: break, breakeven analysis, competitiveness, cost-volume analysis, labor costs, productivity, unions|

Short-Term Housing Rentals Lead to Housing Shortages

Housing availability has plummeted while housing costs have skyrocketed for residents of Florence, Italy, in the wake of popularity for shorter rentals via platforms like Airbnb.

The housing shortage leaves lower income Italians and students particularly hard pressed to find affordable housing. In the absence of action by the central government, the city of Florence has taken matters into its own hands, banning new short-term residential leases on sites like Airbnb. Other cities around the world have faced similar problems.

Video […]

By Lisa M. Spencer|2023-10-27T04:12:23+00:00October 27, 2023|Tags: aggregate planning, capacity planning, inventory management, shortage|

Logistics at the Panama Canal During Drought

Restrictions on daily transit as well as cargo weight will continue throughout 2024, as the Panama Canal deals with drought that has lowered water levels.

Shippers as well as recipients of goods are feeling the impact.

(For an earlier post explaining restricted load sizes through the Panama Canal, see this June 2023 post.)

Video Spotlight:

Drought hampering Panama Canal could have major economic repercussions (Aug 23, 2023, CBS Evening News)
Drought causing backups […]

By Lisa M. Spencer|2023-09-24T06:48:14+00:00September 24, 2023|Tags: bottlenecks, capacity planning, inventory management, lean operations, logistics, nearshoring, reshoring, risk management, supply chain risk, transportation|