Future of Ford Mustang plant in doubt as sales decline, Mazda bails

For Ford Mustang fans, it's tough enough getting beaten in the sales race by the car's long-term rival, the Chevrolet Camaro.

Now the future of the Michigan plant that builds the Mustang is in doubt.

Last week, Mazda Motor Corp. said it would pull out of the AutoAlliance International joint venture with Ford Motor Co. The AutoAlliance plant in Flat Rock, Mich., south of Detroit, builds the Mazda 6 and the Mustang.

Mazda is leaving AutoAlliance because sales of the Mazda 6 have plummeted. Through the end of May, Mazda 6 sales totaled 13,604, down 8.9 percent from the same period a year earlier.

In the first five months of this year, Mustang sales totaled 30,206 units, down 2.8 percent from a year earlier. Meanwhile, in the same period, Camaro sales totaled 40,275 units, up 3.7 percent, as the convertible body style joined the mix.

The problem is that the Mustang's sales, which totaled 73,716 units in 2010, aren't enough by themselves to make a huge factory such as AutoAlliance with its 1,700 workers a profitable operation.

What are Ford's options?

-- Try to boost Mustang sales to help fill the plant. That's a tall order. The Mustang just got a new powertrain lineup for the 2011 model year and had been restyled for the 2010 model year. Fans speculate that an independent rear suspension is in the works to replace the live rear axle, but that could be years away, if ever.

-- Add another product to the Flat Rock plant to increase production. That could come via taking on another joint-venture partner and adding another Ford family product. Is there another use for the Mustang's rear-drive platform?

-- Move Mustang production to another Ford plant. That's a possibility, as Ford pushes to make all of its assembly plants as efficient and profitable as possible. Over the course of its history, the Mustang has been built in plants in Michigan, New Jersey and California.

"The Mustang on its current sales pace isn't enough to sustain Flat Rock," said analyst Jeff Schuster of J. D. Power and Associates.

By Michelle Koueiter