Ford tries to catch up with U.S. rival GM by investing $760 million in a new plant in eastern China.
The new plant will be located in Hangzhou in Zhejiang province and will offer 250,000 units annually from 2015. Its construction is expected to begin by the end of this year. Two weeks ago the company said it would invest $600 million to build a third plant at its Chongqing complex in southwest China, part of its largest expansion since the 1960s in North America and Europe. Ford also announced it plans to build 8 assembly and powertrain plants in Asia.
“We’re looking at this more than just this quarter or this calendar year,” Ford’s Asia chief, Joe Hinrichs, said in an interview. “We’re looking at this as how does Ford set itself up for success for the next several decades in Asia Pacific.
By 2020 Ford expects sales in China to reach about 30 million vehicles, up from 18.5 million in 2011. Ford plans to increase its global sales by about 50% from 2010 to about 8 million vehicles annually by mid-decade. In China Ford produces Fiesta, Focus, Mondeo and other sedans in a three-way tie-up with Chongqing Changan Automobile Co Ltd and Japan’s Mazda Motor Corp. in 2011 Ford sold 320,000 units in China, compared to VW’s annual sales of 2.26 million and GM’s 2.55 million.