Ford Motor to move some production of Focus small car to China
21 Jun 2017
Ford Motor Co said yesterday that it will move some production of its Focus small car to China and import the vehicles to the US, as it bets on low oil prices and stable US-China trade relations despite recent tensions.
According to commentators, the move suggested that China could play a bigger role in vehicle production for North America, perhaps eclipsing Mexico as a low-cost manufacturing source.
Ford pitched the production shift from Mexico to China, slated for mid-2019, as a purely financial move that would save the company $500 million in reduced tooling costs.
Also Ford expects to ship about 80,000 vehicles to China this year, including the redesigned Lincoln Navigator luxury sport utility vehicle, which will roll out of Ford's Kentucky truck plant this fall.
Ford's decision to import its first vehicles from China to the US was also the first major manufacturing investment decision made by new chief executive Jim Hackett, who succeeded Mark Fields in May. According to Joe Hinrichs, president of global operations, discussion about the small-car production shift from Mexico to China began "a couple months ago" under Fields, Reuters reported.
The move spelt more bad news for Mexico than for the US as the Focus had been made at Michigan Assembly plant in Wayne, Michigan for years, according to commentators. Ford had earlier announced plans to shift its production to Mexico.
Ford also said yesterday that it planned to invest $900 million in its Kentucky truck plant to build the new versions of the Ford Expedition and Lincoln Navigator, there. According to the company, the investment would protect 1,000 jobs at that plant.
However, the company's decision to shift production of small cars to Mexico had become a hot-button issue during the US presidential campaign last year, when then-candidate Donald Trump repeatedly slammed the company' for exporting jobs from the US.
He also falsely accused Ford of planning to shift all of its auto production and jobs to Mexico.