Ford to set up second plant in China

Ford is building a new engine plant in China to support new vewhicles on which it hopes to ride to an ambitious growth.

The US auto maker's joint venture, Changan Ford Mazda Automobile Ltd (CFMA), yesterday signed a memorandum of understanding with the Chongqing municipal government to build a new, $500-million ot RMB 3.4 billion engine plant, which will be funded entirely by the Chinese joint venture company - a three-way joint venture among Nanjing-based Changan Motors, Ford Motors and Japan's Mazda Motor Company, which was announced in April 2005.

"This new engine plant will help power our ambitious expansion plans here in the world's largest automotive market," said Joe Hinrichs, Ford's president, Asia Pacific and Africa "We are working hard to expand sales and production here, and to offer more of the great vehicles from our global portfolio here in China and throughout the region. The growth potential in this part of the world in the next ten years is astounding."

Construction of the new plant is planned to begin next year, with engine production starting in 2013. With the additional capacity of 400,000 units at the new plant, Changan Ford Mazda Automobile is more than doubling its existing engine capacity of 350,000, to 750,000 engines annually.

Changan Ford Mazda Automobile currently operates two vehicle assembly plants, one in Chongqing and the other in Nanjing. Last September, CFMA broke ground in Chongqing for its third vehicle assembly plant, which will start producing Ford's global flagship C-segment car, the next generation Focus in 2012.

"This investment will significantly expand our manufacturing capabilities and product offering in China," said Robert Graziano, chairman and CEO, Ford Motor China. "We have big plans for China. As part of our 'Better Plan' for China, we will continue to expand vehicle and engine production, grow our dealer network, and grow our team of local talents."

After several years of considerable growth, Changan Ford Mazda Automobile has established itself as one of the leading passenger car manufacturers in China. CFMA is well known in China for its high quality cars, as well as its efforts to develop and introduce environmentally-friendly technologies.

Ford Motor Company's other partner in China, Jiangling Motors Corporation in Nanchang, produces commercial vehicles, including the Ford Transit, one of the best sellers in China's high-end light bus segment. JMC recently commenced work on a new commercial vehicle plant with an investment of $300 million this July.