How do I clear a car from production?

So I have about 70 hours in this game, and have completed it in brutal difficulty, but there is something I haven’t be able to figure is how do a clear out a model of car/engine out of a factory slot? I know how to stop production of a car, but I am completely stumped on how I can clear out a old model to make room for the new replacement.

You don’t. You just put the replacement on top of it and that does it. There is no need to clear out a factory slot ever.

I must be missing something then, because I can’t even select a factory if it already has two cars in production.

You can only have one model per factory. By “two cars” I assume you mean two trims? If that factory actually is producing then yeah, you should be able to pick it to have its production replaced.

When you start a new car project you should just be able to pick that factory.