Ford Motor Co said yesterday it plans to spend US$490 million on building a third assembly plant in China, ramping up production to meet surging demand in this fast-growing market as it expands in Asia.
The factory, to be built in the central Chinese city of Chongqing, will make the next-generation Focus compact car, which Ford plans to sell globally.
The announcement from Chongqing came the day after the Dearborn, Michigan-based automaker unveiled a made-in-India compact car — part of a drive to boost sales in Asia, a region the US automaker has hardly dented but is counting on to drive growth.
PHOTO: BLOOMBERG
“Today’s announcement reinforces our commitment to the further expansion of our China operations to meet the continued rise in demand from Chinese consumers for world-class Ford products and services,” Ford chief executive Alan Mulally said in a statement.
While in India earlier this week, Mulally said he expects one-third of global car sales to come from Asia in 20 years, a third from the Americas and a third from Europe and Russia.
China is proving a lifesaver for all the big automakers, helping offset declining sales elsewhere.
Total sales in the first eight months of the year rose to 8.33 million units, up nearly 30 percent from a year earlier, according to the China Association of Automobile Manufacturers. China overtook the US as the world’s largest auto market earlier this year, with sales last month jumping 82 percent from a year earlier to 1.14 million units.
The Chongqing plant, part of its joint venture Changan Ford Mazda Automobile Co, is the third for Ford in China and its second in Chongqing, an industrial hub of 30 million people sprawled along the upper reaches of the Yangtze River.
Slated for full completion by 2012, Ford said the plant will be equipped to make other small cars on the company’s global C-car platform in addition to the Focus.
Ford lags behind other automakers in Asia, capturing only 2 percent of auto sales there, compared with nearly 15 percent in North America and 10 percent in Europe.
Ford currently produces 450,000 vehicles in China annually. The new Chongqing facility will initially be able to manufacture 150,000 cars per year, with the capacity to produce 600,000 by 2012 when the plant is at full capacity, the company said.
The company says it plans to introduce four new vehicles in the Chinese market in three years.
The next-generation Focus, scheduled to debut in January at the North American International Auto Show, represents a shift toward C-segment vehicles that Ford says it expects to account for nearly 28 percent of global sales by 2013.
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