Ford could move Kuga SUV production to the U.S.

Ford Kuga

Sources familiar with FoMoCo’s plans say that the Dearborn automaker is looking to move production of its Kuga compact SUV/Crossover to the United States to take advantage of lower labor costs and the weaker dollar, reports Bloomberg.

Sources in Germany said that Ford will move production of the Kuga to Louisville, Kentucky in October 2011. As many as 80,000 units a year are rumored to be exported to Europe.

“This makes sense because Western Europe is not a particularly cheap place to make cars,” said Barclays Capital auto analyst Brian Johnson told Bloomberg. Johnson estimates that Ford’s labor costs in the U.S. could fall $10 an hour lower than Germany.

“Building a car with European specifications on a U.S. assembly line also shows the benefits of having common vehicle platforms.”

Ford is targeting profitability by 2011 and is asking the UAW to make concessions that are competitive with GM and Chrysler.

– By: Stephen Calogera

Source: Bloomberg