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Automakers plan to reopen plants as Trump extends COVID-19 guidelines

Fiat Chrysler Automobiles assembly workers build 2019 Ram pickup trucks at the FCA Sterling Heights Assembly Plant in Sterling Heights, Michigan, October 22, 2018.

Rebecca Cook | Reuters

Major automakers are continuing with plans to restart U.S. vehicle production next month despite President Donald Trump on Sunday extending national social-distancing guidelines through April.

Ford Motor, Fiat Chrysler, Toyota Motor and Honda Motor are continuing with such plans as executives “monitor” or “assess” the situation, spokespeople for the companies told CNBC on Monday.

The automakers would be allowed to reopen plants despite Trump’s extension because it is a guideline, not an order. The federal government has been relying on states to enact their own orders to limit or ban automotive operations and determine if they are an “essential” businesses during the COVID-19 outbreak. The regulations vary state by state. 

As of Monday, 35 states had enacted “stay at home” or “essential business” mandates that affect 231 million people, or 70{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} of the U.S. population, according to J.D. Power. Those include major auto production hubs across the Midwest, including Michigan, Ohio and Indiana.

The impact of the state orders on automotive manufacturing, aside from extensions, is not expected to have any further effect on the industry, according to Tyson Jominy, vice president of data and analytics at J.D. Power.

“We do not expect any material impact on automotive manufacturing and assembly from additional states ordering stay-at-home of residents,” he said in an email. “We are not aware of any automotive plants still operating despite many assembly plants that are located in states without mandatory stay-at-home orders such as Texas, Alabama, Tennessee, Georgia and South Carolina.”

Ford last week announced plans to restart production at “key” U.S. plants on April 14, a week after plans to partially resume operations at a plant in Mexico. Those plans have not changed, according to the company.

“We are continuing to assess public health conditions as well as supplier readiness and will adjust our plans if necessary,” Ford spokeswoman Kelli Felker told CNBC in an email Monday.

Following Ford’s announcement on Wednesday, Fiat Chrysler said its Michigan headquarters, plants in the U.S. and Canada, and construction projects “are intended to remain closed until April 14.” The company said the reopenings will be “dependent upon the various state stay in place orders and the readiness of each facility to return to production.”

“We continue to monitor the situation,” said Fiat Chrysler spokeswoman Jodi Tinson on Monday.

Urged by the United Auto Workers union, Ford, Fiat Chrysler and General Motors announced plans to temporarily shutter their plants due to the coronavirus on March 18. Other nonunionized automakers also shutdown production, many due to state restrictions.

GM has not released any details on plans to potentially restart its U.S. production operations. Jim Cain, a GM spokesman, on Monday said the company’s position has not changed since last week.

“The situation is fluid and can change week to week,” the company previously said. “We don’t have firm return to work dates at this time.”

Toyota, according to company spokesman Victor Vanov, said that the president’s extension has not changed its plans to resume production at its plants on April 20.

Honda confirmed Monday that its plan to restart production remains April 7.

Volkswagen, Nissan Motor and Tesla did not immediately respond for comment.

Tesla shut down operations at its Fremont, California, factory on March 23 following the plant not being considered an “essential business” under the “shelter-in-place” order in the state.

Volkswagen last week said it expected to resume production at its vehicle assembly plant in Tennessee on Sunday. The facility ended production on March 21.

Nissan earlier this month announced plans to temporarily suspend production of its manufacturing facilities in the U.S. starting March 20 through April 6.

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