Ford's is investing heavily in China, hoping to expand sales. The trend in 2012 thus far is the opposite.
Ford and its joint-venture Changan Ford Mazda Automobile (CFMA) will expand its already huge manufacturing complex in Chongqing by 350,000 passenger vehicles, raising total capacity in China to 950,000 vehicles annually. The $600 million investment will increase Ford’s total investment in China to roughly $4.1 billion.
This will make Chongqing by far the largest Ford production site in the world – a latter day Rouge for communist customers. The latest expansion includes a new assembly line, body and paint shop. Construction on the extension is expected to begin immediately and the first vehicle is expected to come off the line in late 2014. CFMA already operates two assembly plants and an engine plant in Chongqing, with another engine plant and a transmission plant currently under construction.
“With a current growth rate of about 5%, the Chinese auto industry remains the biggest growth market in the world,” said Dave Schoch, chairman and CEO, Ford China. “Expanding our production capacity in Chongqing is a key part of our aggressive growth plans in China and Asia.
Ford will introduce 15 new vehicles and 20 new engines and transmissions in China by 2015 as part of its plan to broaden its product portfolio and powertrain offerings in China where it trails other global automakers.
Year-to-date through February, Ford China sales at 71,000 are down from 85,000 last year, a 15% decline. Ford hasn’t released March sales numbers yet. Last year Ford sold 519,000 vehicles in China, where it badly lags well-established competitors such as General Motors or Volkswagen Group, which outsell Ford by a 5:1 or 4:1 ratio, respectively.
