The bullish wave of plant construction hits a wall

The halt in North American automaking due to the COVID-19 emergency is spilling over into some major construction projects that represent the industry's aspirations for the coming decade.

The $1.6 billion Mazda-Toyota joint-venture project in Huntsville, Ala., will be delayed about six months to account for pandemic disruption and social distancing concerns of contractors, the company told Automotive News last week.

Separately, a Toyota Motor North America spokesman said some smaller Toyota investment projects also have been delayed.

Fiat Chrysler Automobiles stopped construction on multiple projects in and around Detroit in late March and last week extended that interruption. FCA has been working on $4.5 billion worth of manufacturing projects in the area.

Ford Motor Co. has paused work on a $740 million project to renovate a dilapidated Detroit train station into a showcase urban office and R&D center. It is intended as a demonstration of Ford's commitment to Detroit and also as a way to attract young engineers.

General Motors currently has only "a limited number of projects underway at a few plants to support timing of critical programs," spokeswoman Kim Carpenter said. But she said small crews are operating under strict safety protocols that "include temperature screening before entering the facility, wearing medical-grade masks and practicing physical distancing."

Startup Rivian Automotive previously said it has delayed the launch of its electric pickup by a year, as it pauses the construction work necessary to tool up its plant in Normal, Ill.

The pandemic has interrupted a wave of bullishness in the North American industry that includes expansion projects and large-scale investments going into auto plants around the country.

The Detroit 3 were beginning to boost their factory capacity to produce additional pickups and SUVs, and expanding and upgrading powertrain plants and stamping operations to support the coming new volumes.

The start of production at the Mazda-Toyota Manufacturing venture, which had been planned for 2021, will be delayed until later that year, said Toni Eberhart, a spokeswoman for the project.

The plant was to begin production of 150,000 units each of a Toyota and a Mazda crossover yet to be named. Any job that could not meet social distancing recommendations had to be halted, which caused the project to pause briefly this month. It then resumed, but it has now been halted because of lack of construction materials.

"We informed state and local government officials in Alabama, along with our key suppliers, how the COVID-19 pandemic is impacting our ability to maintain critical equipment delivery schedules, creating labor shortages and slowing construction," Eberhart said in an emailed statement.

But the construction stoppages are not universal. A North American spokesman for Daimler said Mercedes-Benz is pressing ahead on its $1 billion project to introduce electric vehicle manufacturing into its Vance, Ala., operations. That project includes the construction of a battery plant nearby, which remains underway.

At the same time, amid last week's dire industry news reports, GM moved forward to start a $2 billion project in Lordstown, Ohio, to construct an EV battery plant in partnership with battery technology supplier LG Chem. But that project is currently only at the site preparation stage.

Omari Gardner, Hannah Lutz, Michael Martinez, Vince Bond Jr. and Urvaksh Karkaria contributed to this report.