Ford Beginning to Probe Chinese Auto Market
Ford Motor Co. is in talks with local partners to introduce indigenous brands in China as it plays catch-up in the world’s biggest auto market with the likes of General Motors Co. and Volkswagen International, its China chief said on Monday (June 4).
Such a move would see Ford join other foreign car makers in launching indigenous China-only brands, in part to comply with government rules that allow them to make cars on the mainland.
“We are always in discussions with our joint-venture partners,” David Schoch, chairman and CEO of Ford’s China operations, told Reuters in an interview in Taipei. “All I can tell you is we are studying indigenous brands, but our total focus in terms of brand enhancement is really on the Ford brand.”
China’s vehicles market, which includes cars, vans and trucks, will likely expand by around 5% this year and that pace of growth was likely to be sustained over the next few years, Schoch added. China’s 2011 vehicles sales stood at 18.5 million.
Ford, which makes its Fiesta, Focus, Mondeo and other sedans in China in a three-way tie-up with Chongqing Changan Automobile Co. Ltd and Japan’s Mazda Motor Corp, is a relative latecomer in China, where General Motors and Germany’s Volkswagen have a sizeable lead. It also holds 30% of Jiangling Motors Corp.which makes Ford’s Transit vans.
Typically, China-only brands use older technology that foreign companies no longer use, enabling them to keep vehicle costs lower and at the same time help Chinese partners learn the ropes in developing and marketing modern cars.