Ford Shares Fall After Fire at Key Aluminum Supplier
A massive fire destroyed much of the Novelis facility in Oswego, New York.
Ford Motor Co. (NYSE: F) shares dropped 1.6% Tuesday morning after The Wall Street Journal reported that a major fire at an aluminum plant in New York could disrupt the automaker’s production for several months.
The blaze destroyed a significant portion of the Novelis plant in Oswego, New York, which supplies roughly 40% of the aluminum sheet used by the U.S. auto industry. According to the report, the facility isn’t expected to resume full operations until early next year.
The impact could be particularly severe for the Ford F-150, the company’s top-selling model and main profit driver. The pickup has relied heavily on aluminum body panels since Ford switched from steel to aluminum construction about a decade ago.
Sources familiar with the situation said the disruption is serious enough that Ford is expected to address potential fallout when it reports its next quarterly earnings.
In a statement, Ford noted that it sources aluminum from multiple suppliers besides Novelis, though it remains unclear how much of the shortfall those alternative suppliers can cover.
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