Ford eyes more customers in China

  • 31-Mar-2008 05:39 EDT

Ford has been busy in China recently, opening a new vehicle-assembly plant and a new R&D center (shown), both in Nanjing.

Access to the Internet means Chinese consumers know about new product offerings, and they in turn want “those” products, not the products “that have been obsoleted,” Mei-Wei Cheng, Chairman and CEO of Ford Motor China, said at an October 2007 Asia-focused conference in Michigan.

Between 2003 and the end of 2006, Ford, via its passenger-car joint venture, Changan Ford Mazda Automobile (CFMA), went from zero dealerships in China to more than 200. Vehicles are being shipped from the new $510 million CFMA assembly plant in Nanjing, where a maximum of eight models with different chassis can be produced simultaneously on the production lines that went live in September 2007.

The Nanjing assembly plant has an initial annual vehicle capacity of 160,000 units. Add another 250,000 units via CFMA’s first manufacturing plant, located in Chongqing, and the total yearly capacity in China for Ford is 410,000 vehicles.

The company recorded an 87% increase in sales from 2005 to 2006. And 2007 looks to wrap as another impressive business year. According to Cheng, the keys to success in China are partner, product, people, and process.

“And, you can add another P: promotion,” said Cheng. Product needs to hit the mark in terms of price, fuel efficiency, design, safety, and quality, according to Cheng, who added, “We must have best-in-class products and technology because that’s the only way you’re going to be able to compete long-term.”

Nanjing is also home to a Ford joint-venture engine plant that started production in April 2007, and a 100% Ford-owned engineering and research center that opened in October 2007, just six months after its groundbreaking. Cheng said approximately 200 engineers will be among the center’s initial 300-employee roster.

About 750 employees work for Ford in China, but add joint-venture and commercial-vehicle employees and the total is about 15,000. While a Ford official would not disclose the amount Ford spends to buy parts for the Chinese market, the company’s sourcing operation in China purchased more than $2.6 billion in parts for export in 2006.

Investments made in China, said Cheng, “will enhance global competitiveness.” He added that although newcomers to China should “expect the toughest competition of anywhere,” a robust macro-economy and increasing consumerism bode well for continued automotive industry growth.

HTML for Linking to Page
Page URL
Rate It
0.00 Avg. Rating

Related Items