GM, Ford Brazil Units To Halt Auto
Production For 12 Days
Dow Jones Newswires
SAO PAULO (AP)--The Brazilian subsidiaries of U.S.-based Ford
Motor Co. (F) and General Motors Corp. (GM) said on Friday they
would halt production in an effort to shrink their inventories of unsold
vehicles.
Ford said its assembly line in the Sao Paulo industrial suburb of Sao
Bernardo do Campo will shut down for 12 days starting Sept. 28. The
plant produces 850 vehicles a day.
The plant's 6,500 workers will get paid leave during the 12-day shutdown.
Ford will also stop production at its engine and gearbox plant in the city of
Taubate for the same period of time.
The automaker's press office said the production halt was an effort "to
adjust production to demand."
Ford refused to reveal the size of its stock of unsold vehicles. Since last
November, slumping sales and large inventories have forced Ford to stop
production for a total of 70 days on four separate occasions.
In a similar effort to "adjust production to the market," General Motors'
press office said the company's assembly line in the city of Sao Jose dos
Campos will also stop production for 12 days as of Oct. 5. It would not
give further details.
Italian automaker Fiat S.P.A. (FIA), which last July reduced its daily
output to 2,100 units from 2,200 units, said it was studying measures to
keep its inventory low.
The company said it has a "normal" stock of approximately 25,000 unsold
cars, mostly at its dealership network.
The Brazilian unit of Volkswagen AG (G.VOW), the country's largest
automaker, said it had no plans to stop production.
The Brazilian auto industry's sales started dropping sharply late last year
when the government introduced a series of austerity measures to counter
the effects of the Asian crisis.
To boost auto sales, the government in late July reduced by five
percentage points the excise tax on industrial production. But the measure
failed to have much an effect on sales.
Domestic auto sales during the first eight months of the year plummeted
25% compared to the same period in 1997, while output decreased 17%,
according to the National Association of Vehicle Manufacturers. |
