Ford is investing big in domestic factories (Credit: Fo... Ford is investing big in domestic factories (Credit: Ford).
Ford Motor Co. has a pretty nice holiday gift for the U.S. economy and job market: The company plans to invest $6.2 billion to expand its U.S. manufacturing base, a move that will help it save 3,240 existing jobs and add another 12,000 positions by 2015.

A large portion of the of the investment will go into the automaker's home state of Michigan, which will see the addition of 2,350 new jobs.

"These investments, many of which are already under way, will ensure our southeast Michigan manufacturing facilities can support our aggressive growth plans," said Jim Tetreault, the Ford vice president in charge of North American manufacturing.

Ford's investment in additional U.S. manufacturing will cover an array of auto parts as well as vehicle assembly plants. In the Detroit area, that includes an axle plant, a stamping facility and two assembly lines. The Michigan Assembly Plant has become the home base for an array of high-mileage models including the new Ford Focus Electric battery car.

The Dearborn, Mich. automaker will also invest more in its Flat Rock, Mich. plant that now builds the Ford Fusion and Lincoln MKZ. Ford recently started building those vehicles in Michigan after moving their production north from Mexico.

Ford's move is part of a growing trend of manufacturing companies "in-sourcing" jobs and production to the U.S. back from lower-cost wage countries like Mexico and China. Higher quality workers, plus the elimination of cumbersome and costly shipping and energy costs from abroad is making U.S. shores more attractive. General Electric, for example, has been rebuilding a large manufacturing facility in Kentucky after having previously shipped jobs in that state to China.

Michigan's governor recently signed a controversial "right to work" law into effect in Michigan, which means that workers need not join a union to get employment at a particular facility. But that law had nothing to do with Ford's move. Not only does Ford's agreement with the United Auto Workers pre-empt the law through 2014, but there is every possibility that the law will be overturned with the 2014 elections if Democrats win back the state House and Governor's office.

Ford came through the 2008-2009 financial debacle that took General Motors and Chrysler into bankruptcy without a government bailout or bankruptcy. Ford is operating profitably. And the entire auto industry has been re-sized to make profits at a lower rate of sales.

In 2009, sales tumbled to 10.3 million. But consumer demand and a better economy will push sales close to 14.5 million vehicles this year.

A key part of Ford's investment is to continue to make all of its factories flexible so they are not locked into making just one kind of vehicle. In years past, the automakers had plants that just turned out trucks, or big cars or small cars. When gas prices or tastes sunk the sales of that vehicle, it was costly to re-tool or keep the plant open. Now, Ford, as well as GM and Chrysler are about as flexible in most of their plants as the Japanese owned plants in the U.S.--able to turn out multiple kind of vehicles to go with the times and economic conditions.

That not only is making Ford and its U.S. rivals more profitable and competitive, but it creates more job security for workers.


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