Thursday, 18 December 2014

Blue Diamond is set for a revamp

In the same way that production of castings at 5565 Brookville Road, Indianapolis, Indiana ends in 2015 (see next news story), so too will Ford Motor Company end its Blue Diamond truck-making joint venture with Navistar.

Early next year, Ford will bring to a close its Blue Diamond joint venture with Navistar International Corporation in Escobedo, Mexico. Instead, as reported here previously, Ford will produce in-house versions of its F-650 and F-750 medium-duty for the 2016 model year at its facility Avon Lake, Ohio.

Earlier this year, Ford said it planned to end the joint venture in early 2015 and move production of the trucks to Ohio.

"We expect to be able to better meet customer needs by designing and manufacturing the all-new F-650/F-750 in-house, in addition to using Ford designed and built engines and transmissions," said a Ford spokesman at the time.

The current generation of F-650 and F-750 trucks has been produced since 2004 by Blue Diamond Truck Company, which operates in the Navistar facility in General Escobedo, Mexico.

Navistar International and Ford formed the venture in 2001. In December of 2011, Ford notified Navistar it would end of the partnership. The decision came as part of Ford's deal with the United Auto Workers to move production from Mexico to the US. It may have had something to do also with the bitter rift which developed between the companies over Navistar’s handing of production of PowerStroke engines for Ford’s F-Series pick-up trucks.

The 2016 model year F-Series trucks will be built in Avon Lake, Ohio, starting in mid-2015. Ford executives have also elected to end the company’s partnership with Cummins and Allison Transmission by equipping the trucks with a pair of Ford-built engines and a Ford transmission. The trucks will be available with a gasoline V10 or diesel-powered V8. For the first time, these trucks will use largely in-house components allowing to Ford to have tighter control over its costs.

Navistar has been kept “well informed” about Ford's decision to end the Blue Diamond pact, according to Troy Clarke, Navistar chief executive officer, speaking to investors during a conference call earlier this year.

"That line in Mexico builds not only medium-duty trucks for Ford, but also medium-duty trucks for Navistar," Troy Clarke said. "And so, we do have plans for how to use those assets going forward. “Quite frankly, it provides additional production capacity for us going forward as well, and it gives us the opportunity to rationalize where we build certain products to reduce our logistics costs, so we can ship from different sites."

Whether Troy Clarke feels the same when the last Ford F-Series truck runs down the line, remains to be seen.

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