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Ford Investing $1.1 Billion in China to Boost Competitiveness
In a bid to increase its presence in the world's largest car market, Ford has announced a significant investment of $1.1 billion in China. This marks Ford's first major investment in the country in several years.
The investment will be used for a new factory in Chongqing, as well as an increase in production of power trains and engines. The new factory is expected to boost Ford's car capacity to 650,000 units by 2012.
The investment will primarily focus on the production of two new vehicles - the new Ford Mondeo and the 2019 Ford Focus. The production version of the new Focus, manufactured by Changan-Ford, a joint venture between Ford and Changan Automobile, has already been released.
However, the new Focus is not part of the limited vehicles Ford currently offers in China. Ford's offering in the country is quite limited, with only 6 vehicles available compared to GM's and Volkswagen's more than 15.
The vehicles offered by GM and Volkswagen in China are made locally and are thus cheaper. This has been a significant problem for Ford, as the company has struggled to compete in the price-sensitive Chinese market.
The investment and the production of new vehicles are efforts by Ford to increase its competitiveness in the Chinese market. The company aims to offer more affordable options to Chinese consumers, like the new Focus, which may be cheaper due to local production.
The growing demand for cars in China has driven this investment. Last year, both GM and Volkswagen sold more than 1 million vehicles in China, a feat that Ford has yet to achieve.
The new Ford Mondeo has also arrived at dealers in China. The company hopes that these new investments and offerings will help it to better compete in the Chinese market and increase its sales in the future.
Meanwhile, it's worth noting that Volkswagen made a similar investment of $1.1 billion in China back in May 2020, focusing on a new manufacturing site in Chongqing to increase motor and transmission production.
Interestingly, one of the vehicles Ford offers in China is an ancient version of the Transit van. The company is clearly looking to expand its offerings and better cater to the diverse needs of the Chinese market.
In conclusion, Ford's investment in China is a strategic move to boost its competitiveness and increase its offerings in the world's largest car market. The production of the new Ford Focus and Mondeo, as well as the expansion of its factory in Chongqing, are all part of this ambitious plan.
