With new Ford Focus driving further growth, Ford Motor Company continues to expand its China operations
CHONGQING, October 21, 2005 — Changan Ford Automobile Co., Ltd. (Changan Ford), a Ford Motor Company joint venture in China, held a ceremony today in its Chongqing assembly plant to mark the completion of a major expansion program. The expansion program, which has increased annual production capacity to 150,000 units, includes a new stamping plant, engine plant and assembly plant. This achievement represents another milestone for Ford Motor Company in line with an expansion plan announced two years ago.
Jim Padilla, president and chief operating officer of Ford Motor Company, was present to congratulate the teams from Ford China and Changan Automotive Group on their achievement. Padilla also spent time reviewing progress of the recently launched Ford Focus. Production of the Focus, the fourth Ford brand vehicle made in China , began in early September in Changan Ford's Chongqing plant.
"Today marks another successful milestone for Ford Motor Company's business expansion plan in China ," said Padilla. "I'm proud to say that we continue to deliver against our investment commitment in China ."
In October 2003, Bill Ford, chairman and chief executive officer of Ford Motor Company, visited China and announced that, together with its Chinese partner Changan Automotive Group, the company was going to invest over $1 billion to expand operations in China .
In addition to the Chongqing effort, Ford Motor Company and partners Changan Automotive Group and Mazda Motor Corporation have begun construction of a new vehicle assembly facility in Nanjing . Moreover, in Nanjing , construction is underway at a new engine plant by partners Changan, Ford and Mazda. The adjacent engine and vehicle assembly sites in Nanjing are expected to be operational in early 2007. Initial capacity at Nanjing vehicle assembly will be 160,000 units annually.
By 2007, with further planned expansion in Chongqing , combined total production capacity at both sites will be approximately 360,000 units, 18 times that of 2003. The installed capacity can also be quickly increased should the need arise.
NEW FOCUS TO DRIVE GROWTH IN CHINA
While in Chongqing , Padilla reviewed the recently launched Ford Focus. With over 100 major international awards to its credit and more than 5 million units sold globally, Focus is one of Ford's most successful world-class cars. The locally made Focus is expected to be the major contributor to the continued sales growth of Changan Ford.
"I am confident that Focus is the right vehicle coming at the right time for China ," noted Padilla. "It combines outstanding European design, excellent German engineering and superior driving quality. People who drive the all-new Focus just can’t get enough of it. We expect it to cause the same stir here as it has elsewhere in the world and believe it will be a major catalyst for further growth for Ford in China ."
Padilla was also positive about Changan Ford's state-of-the-art production line for the Focus localization. He said the production line "fully meets the standards of Ford Global Quality Operating System, which ensures Chinese customers enjoy the same high product quality as their peers in any other places in the world."
Phil Spender, president and chief executive officer of Changan Ford is optimistic about the future of Focus. He comments, “Focus is on track to success. Response has been strong since launch, with orders and sales exceeding Changan Ford expectations after just four weeks.”
To meet the growing marketing and sales needs, Changan Ford is rapidly expanding its sales network. To date, over 130 dealers have been authorized and the number will reach 150 by the end of this year.
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PARTNERSHIP WITH CHANGAN GROUP TO BE STRENGTHENED
Mei Wei Cheng, chairman and chief executive officer of Ford Motor ( China ) Ltd., attributed the success of Changan Ford to the long-term, strategic partnership forged between Ford Motor Company and Changan Group, which ensures sound communications and excellent synergies.
"I'm particularly impressed with the growth of Changan Group over the past few years, which has helped us get a strong foothold among the top tier Chinese auto makers," Cheng said. "Ford Motor Company is going to continue to work closely with Changan Group and grow hand in hand towards a better future."
He indicated that Ford Motor Company will introduce even more new products for localization in a bid to meet the growing and quickly diversifying demands of Chinese consumers. Currently, Ford Motor Company has four products being locally produced: Fiesta, Mondeo and Focus by Changan Ford, and Transit by Jiangling Motors Co., Ltd. (JMC).
COMMERCIAL VEHICLE TO BECOME ANOTHER SPOTLIGHT
On October 20, Padilla visited JMC based in Nanchang , the capital city of Jiangxi Province . Ford Motor Company now owns 30 per cent of JMC, which has produced the Ford Transit series since 1997 in addition to other commercial vehicle models.
"JMC has maintained a good record of sustained growth and profitability over the past few years despite the dramatic changes in the country's auto market," Padilla said of his visit.
"Ford Motor Company is pleased with the return of its investment in JMC and will provide further support to help it become a top commercial vehicle manufacturer in China ."
In 2004, JMC sold over 12,000 units of Ford Transit. This year, the Ford Transit series is expected to achieve a growth rate of over 40 per cent.
TO BUILD UP A BRAND NEW ENTERPRISE MODEL IN CHINA
As for the next step for Ford Motor Company in China , Padilla noted that the company is "in a position to become one of the country's top auto players. We are still confident of the growth potential for Ford Motor Company in China ."
"One of our key corporate goals is to optimize our global footprint. In line with this effort, we are working in measured way to build on our automotive enterprise in China , by working with all our company's affiliated brands, partners and business operations to achieve best results," he said. "With this enterprise model well established, we're confident we can face any challenges from the competition and will surely provide Chinese customers with a complete line of products and services, with superior quality and competitive price."
In addition to Ford brand products, other Ford Motor Company brands also reported significant growth in China market. In the first three quarters this year, Volvo has achieved a 50 percent sales growth over the same period of last year. Land Rover and Jaguar have registered increases of 147 per cent and 60 per cent, respectively.
Ford Motor Company, a global automotive industry leader based in Dearborn, Mich., U.S.A., manufactures and distributes automobiles in 200 markets across six continents. With more than 328,000 employees worldwide, the company’s automotive brands include Aston Martin, Ford, Jaguar, Land Rover, Lincoln , Mazda, Mercury and Volvo. Its automotive-related services include Ford Credit and Quality Care. Ford Motor Company celebrated its 100 th anniversary in 2003.
Ford’s history in China can be traced to 1913, when its first Model T was imported and sold in Shanghai . Presently, Ford owns 30% of the shares of Jiangling Motors Corporation Ltd., which produces Ford commercial vehicle Transit and other products. Ford Motor Company also has a 50-50-passenger car joint venture with Changan Automotive Corporation Ltd., which is called Changan Ford Automobile Corporation Ltd. Changan Ford has successfully launched three Ford passenger cars models, Fiesta, Mondeo and Focus, to the market. Ford Mondeo has won Motor Trend "2005 Car of the Year, China". The all-new Ford Focus was launched in September. In early 2005, Changan Ford's second passenger car plant in Nanjing started construction. On April 19, 2005 , Ford, Changan and Mazda announced a new three-way engine plant joint venture, Changan Ford Mazda Engine Company Ltd., in Nanjing . The engine company held its groundbreaking ceremony in late September, 2005.
On the import business, Ford Maverick, a member of the world-renowned Ford SUV product line, is also on sale in China now. Lincoln Navigator, a premium, full-size SUV was launched in China market in May, 2005.
Products of the other Ford Motor Company affiliated brands and partner; including Jaguar, Land Rover, Volvo and Mazda are on sale in China as well. Ford's service brand, Ford QualityCare, is also serving the customers in China .
