Ford exits 3-way tie-up to expand in China
By Lu Nengneng |
August 28, 2012, Tuesday
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Print Edition
Print Edition
FORD Motor Co has got regulatory approval from China's top economic planner to separate its Chinese joint venture business from its current three-way tie-up with two automakers as it seeks a bigger role in the world's largest car market.
The reorganization will see Ford and Japan's Mazda Motor Corp operate under their respective partnership with Chongqing Changan Automotive Co in research & development, manufacturing and sales in China. The reorganization, which the National Development and Reform Commission has approved, still needs approval from three other government agencies.
The new joint venture will raise Ford's stake in its Chinese business from 35 percent to 50 percent, giving it more control as it expands in China, where market research firm LMC Automotive said it has 2.5 percent market share, trailing the 10 percent of rival General Motors.
"Asia-Pacific is such a fantastic growth market, and China specifically - even though we've slowed down a little bit, it's still in the 10 percent range, which is a terrific growth rate," Alan Mulally, CEO of Ford, said yesterday in Chongqing.
Ford broke ground for its third assembly plant in the city yesterday. The plant, costing US$600 million, is set to open in late 2014. The second-largest US carmaker also has an engine factory being built there to produce the 2.0-liter EcoBoost turbocharged engine next year.
The three-way tie-up has manufacturing operations mainly in Chongqing and Nanjing, Jiangsu Province. After the restructuring, Ford's new joint venture will operate the Chongqing plant while Mazda's will run the Nanjing plant.
The reorganization will see Ford and Japan's Mazda Motor Corp operate under their respective partnership with Chongqing Changan Automotive Co in research & development, manufacturing and sales in China. The reorganization, which the National Development and Reform Commission has approved, still needs approval from three other government agencies.
The new joint venture will raise Ford's stake in its Chinese business from 35 percent to 50 percent, giving it more control as it expands in China, where market research firm LMC Automotive said it has 2.5 percent market share, trailing the 10 percent of rival General Motors.
"Asia-Pacific is such a fantastic growth market, and China specifically - even though we've slowed down a little bit, it's still in the 10 percent range, which is a terrific growth rate," Alan Mulally, CEO of Ford, said yesterday in Chongqing.
Ford broke ground for its third assembly plant in the city yesterday. The plant, costing US$600 million, is set to open in late 2014. The second-largest US carmaker also has an engine factory being built there to produce the 2.0-liter EcoBoost turbocharged engine next year.
The three-way tie-up has manufacturing operations mainly in Chongqing and Nanjing, Jiangsu Province. After the restructuring, Ford's new joint venture will operate the Chongqing plant while Mazda's will run the Nanjing plant.
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