Ford to exit Japan and Indonesia this year image

Ford Motor announced it would close all operations in Japan and Indonesia this year because of weak sales and a low market share.

The Detroit-based automaker sees “no reasonable path to profitability” in Japan and Indonesia where it has struggled to gain market share. Therefore, it decided to exit from all segments of business, including closing dealerships and stopping sales and imports of Ford and Lincoln vehicles, while the product development carried out in Japan is to be shifted elsewhere. This news emerged from an email from Asia Pacific President Dave Schoch sent on Monday to all employees in the region and viewed by Reuters. “Unfortunately, this also means that our team members based in Japan and Indonesia will no longer work for Ford Japan or Ford Indonesia following the closures,” Schoch wrote in the email regarding the decision. Ford’s exit comes one-year after General Motors also decided to close its production operations at a local plant in Indonesia, ceasing output of locally manufactured GM-branded autos. That move was forced by the intense competition of the Japanese brands, around 500 jobs being lost in the process.

Ford’s operations in Japan have started in 1974, with a 52 dealership network in the country, employing 292 people. Last year, it sold around 5,000 vehicles with a market share of around 1.5 percent of the new car imports. In Indonesia, where it entered in 2002, the automaker has a staff of 35 and sells its cars through 44 franchised dealerships. Last year, it delivered around 6,000 vehicles, taking a 0.6 percent share of the total new car market in a country struggling with economic slowdown.