How truck OEMs are dealing with Covid-19
TORONTO, Ont. – Much of North America’s truck manufacturing industry is grinding to a halt, as OEMs take a range of actions to cope with decreasing demand and to manage the Covid-19 pandemic.
Paccar last night became the latest North American OEM to suspend truck production worldwide, due to “recent changes in customer demand and a weaker outlook for the global economy, as a consequence of the coronavirus pandemic.”
The shutdown will go from March 24 until April 6, and will be reviewed on a regular basis. Paccar said it will continue to provide aftermarket support to its customers. The company is also adjusting its 2020 financial outlook.
Mack, Volvo first to act
Volvo Group companies Volvo Trucks North America and Mack Trucks were the first to close production at U.S. factories in response to the pandemic.
“Although we have no reason to believe we have any cases of Covid-19 at our Volvo Trucks or Volvo Group powertrain manufacturing facilities, we have decided to temporarily suspend production as part of the effort to slow the spread of the virus in our communities,” Mary Beth Halprin, vice-president, public relations and corporate affairs with Volvo Group told Today’s Trucking.
“Effective today, Monday, March 23, we will suspend production through Friday, March 27; moving forward, we will monitor the situation and communicate additional decisions on a weekly basis. During this suspension, we will be exploring new ways of working and possible approaches to production that would allow for increased social distancing in the facility. The health and safety of our employees and communities will be our primary concern as we work to make the most informed decisions we can during this uncertain time.”
Mack Trucks suspended production beginning March 19 through March 27. In a letter to customers, Jonathan Randall, senior vice-president of sales and marketing, assured that Mack Trucks and its dealer network remains ready to support customers.
Navistar suspends production in Ohio
Navistar International announced Monday it is suspending production at its truck assembly plant in Springfield, Ohio, for two weeks in response to Covid-19-related disruptions to its supply chain. It is also withdrawing previously announced financial and industry guidance for the fiscal year.
Navistar cannot predict if or when any further disruptions will occur due to the rapidly changing environment as the Covid-19 pandemic continues to evolve,” the company announced. “The company believes its future financial results will be impacted, but at this time, the magnitude of those impacts is uncertain. As a result, the company is withdrawing its 2020 financial and industry guidance.”
Daimler still producing
Daimler Trucks North America (DTNA) is still producing trucks and engines. It temporarily closed its Detroit powertrain campus in Redford, Mich., after an employee there tested positive for Covid-19, but the facility was set to resume operations March 23.
“Our industry plays a critical role in our national infrastructure. Besides food, sanitation, and emergency services, there are a myriad of items such as hospital supplies, test kits, and other items desperately needed to combat the virus and to treat its victims, which require transportation by commercial vehicles,” the company said in a letter to customers. “The Department of Homeland Security has designated transportation equipment manufacturing to be part of the nation’s Critical Manufacturing Sector.”
DTNA leaders said the company’s supply chain has not seen any constraints or labor disruptions and that its North American facilities are delivering trucks on time.
“So far this month, our on-time delivery rate continues to be at a very high level. The environment is changing rapidly and we are adapting every day,” the company said.
“We are in a unique and challenging period in history, one that requires patience, creativity, and careful planning. Please know that we are monitoring and adapting to the situation as it develops, and that we recognize that communication is critical to successfully navigating it.”
UPDATE: Since this article was first published, DTNA issued a statement updating its production (reprinted below in full):
DTNA is beginning to experience supply disruptions due to COVID-19 that will soon impact our production operations. Accordingly, we are making operational adjustments. Starting this week, DTNA will limit its operations at several facilities in North America until a planned return to production on Monday, April 6 in the U.S and April 14 in Mexico.
Manufacturing plants limiting production this week include Mt. Holly Truck Plant in North Carolina; Cleveland Truck Plant in North Carolina; Gaffney Truck Plant in South Carolina; Portland Truck Plant in Oregon; and Saltillo Truck Plant and Santiago Truck Plant in Mexico.
There will be limited operations at each plant location during this period, as we will continue to provide full support of our Aftermarket operations to ensure our Parts Distribution Centers continue to run smoothly and fulfill their crucial role helping to keep critical infrastructure running.
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It will get bad right now, but you will good for the DEALERS when this all blows over, because they will sell every truck on the lots because they will be the only ones available in the short term.
Guess I should spell check, LOL
“but this will be good for dealers”
We work at Navistar IPD in Melrose Park. We are working through the covid19 quarantine despite the warnings. Upper management, our Lisle facility Woodridge location and Springfield are all closed. But they told us in product development that we are crucial to the countries infrastructure. (I can’t see how test data for developing new products is considered infrastructure crucial).
We had on union member who’s ex-wife has been diagnosed with the virus. He was exposed to her a day before the diagnosis, but told by our HR that he needed to be at work unless he had symptoms, or he would not get paid.