HindustanTimes.com

Friday, October 17, 2003

Ford announces $1.5 bn expansion in China

Associated Press
Beijing, October 17

Ford Motor Co on Friday announced an expansion of its China operations that
will cost up to $1.5 billion and boost car production from 20,000 a year to
150,000.

The US automaker and its Chinese partner, Changan Automobile Group, will
expand production at their factory in the western city of Chongqing, and
build a second car plant and a new engine plant, said Ford chief executive
Bill Ford.

The partners also will introduce new products and expand distribution
channels to take advantage of China's booming car market, Ford said.
"Every automobile company in the world realizes the potential for Asian
growth, and we know that China will lead that growth," Ford said at a news
conference.

Ford was a relatively late arrival in China, beginning auto production in
1997, and is trying to catch up with US, German and Japanese rivals.

Germany's Volkswagen makes 880,000 vehicles a year in China and recently
announced a multibillion-dollar expansion to double that in coming years.
General Motors recently stepped up its manufacturing capacity in China to
200,000 cars per year, according to the Asian Wall Street Journal.

Ford and Changan, each of which hold 50 per cent of their joint venture,
began producing the Ford Fiesta compact in January, followed by the larger
Mondeo sedan in May.

In July, they started assembling the Ford Maverick, a compact sport utility
vehicle. Ford also owns a 30 per cent stake in Jianling Motor Corp in the
southern province of Jiangxi, through which it has produced the Transit
delivery van since 1997.

Ford also has six smaller joint ventures producing auto parts and
components. Its financing company, Ford Credit, has opened an office to
prepare for the opening of the auto financing business to foreign companies.

During an earlier visit to Thailand, Ford announced the company and its
Japanese affiliate Mazda would invest $540 million in their joint venture
plant in Thailand.

That would expand the capacity of its joint venture plant, Auto Alliance
Thailand, to 200,000 vehicles per year from the current 135,000.

© Hindustan Times Ltd. 2003.
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