Ford makes big investment in Louisville
LOUISVILLE, Ky. – Ford has transformed a nearly 60-year-old assembly plant into the new home of the redesigned Escape, its entry in the ultra-competitive small SUV category. And it's bolstered the workforce to make the vehicle.
Ford Motor Co. invested $600 million to revamp its Louisville Assembly Plant, which features a new body, paint and trim assembly lines. The plant produced Ford Explorers from the early 1990s until late 2010.
On Wednesday, the plant is celebrating the launch of the new Escape, which goes on sale this month.
The plant's hourly workforce will swell to about 4,200 once a third shift is added this fall, the company said. As a spinoff, suppliers are adding more than 900 jobs in support of Escape production, Ford said.
Louisville Mayor Greg Fischer calls it a "generational type of investment" by the automaker.
"It's a wonderful shot in the arm for our economy," he said.
Many of the jobs were filled by incumbent Ford workers in Louisville or from places where factories closed or downsized.
But some 18,000 applicants scrambled for about 1,800 new jobs at the plant; those jobs have since been filled.
Once the third shift cranks up, the Louisville plant will rank among the largest workforces at Ford's domestic assembly plants. The plant's wage scale ranges from nearly $16 per hour for new hires to about $28 per hour for the most skilled workers.
That work force had shrunk to about 1,100 when the last Explorers rolled off the assembly line at the Louisville plant in late 2010. Production of that mid-size SUV has shifted to a Chicago plant.
Some employees thought they had pulled their last shifts at the Louisville plant when it was idled.
"When we went down, there were a lot of people who didn't believe we'd ever retool," said Steven M. Stone, the UAW chairman for the Louisville Assembly Plant.
Now, the remodeled plant is touted as the most flexible in Ford's domestic assembly chain, capable of producing up to six different models at the same time. It can build small, medium or large vehicles, but Ford officials haven't discussed any other models for the plant.
"We're putting that flexibility in for a reason, to take advantage of it in the future," said Jim Tetreault, Ford's vice president of North America Manufacturing.
The plant, which first opened in 1955, will be the model for future renovations of other Ford plants, he said.
"Our whole idea is to maximize capacity, because we're going to run them on all three shifts, which we didn't do years ago, and be able to produce multiple vehicles," Tetreault said.
Employees see the plant's versatility as a plus for job security, Stone said.
"That will give us a lot of opportunity to change with the market," he said. "That's the good part for job security. But I don't anticipate any time soon that we'll be building anything but the Escape."
Ford will get $240 million in tax incentives from state and local governments over the next decade for the plant's renovations.
Across town, the Kentucky Truck Plant in eastern Louisville employs about 4,000 people. The facility makes F-series Super Duty pickups as well as the Expedition and Navigator sport utility vehicles.
Once the third shift is added at LAP, Ford's employment will surpass 8,000 in Louisville — where the company has been making vehicles since 1913. Only the Detroit area will have more assembly line workers than Louisville, Tetreault said.
Nationally, Ford has added more than 5,200 hourly jobs this year — nearly half the 12,000 new hires Ford has said will be added by 2015.
"We'll pass the mark well before 2015," Tetreault said.
Ford isn't the only major manufacturer to add jobs in Louisville.
So far this year, General Electric has hired more than 1,000 workers to handle production of a hybrid water heater and bottom freezer refrigerators at its sprawling Appliance Park in Kentucky's largest city.
The company plans to start a second shift in its refrigerator factory later this summer, creating more jobs.
GE also says preparations are under way to open another plant at Appliance Park to make front load washing machines and matching dryers in early 2013. GE said it expects to create hundreds of new jobs from introducing new laundry products within the next year, including investments in its top load washers.
In Kentucky, manufacturing accounts for about one of every 10 jobs, down from about two in 10 jobs in the early 1990s, said University of Kentucky economics professor Ken Troske.
"We're never going to return to that," he said. "Will manufacturing employment kind of stabilize? Maybe. Will it grow? Maybe just a little."
The unemployment rate in Jefferson County, which includes Louisville, was 8.1 percent in April, down from 9.8 percent a year earlier.
Fischer said he's seeing broader signs that employers are making investments and expanding work forces.
"We're not back into the glory days, and we all know now in retrospect those were overheated," he said. "But we're having a slow comeback out of the recession."