Ford to invest $760m in China plant

City A.M. Reporter
Ford is investing $760m to build a new plant in eastern China as part of its effort to catch up with U.S. rival General Motors Co in the world's largest auto market.

Ford said the new plant in Hangzhou in Zhejiang province will initially boost the US automaker's annual capacity in China by 250,000 vehicles when production begins in 2015. Construction is expected to begin later this year.

The announcement comes two weeks after Ford said it would invest $600m to build a third plant at its Chongqing complex in southwest China and is part of the largest and fastest expansion by the company since the 1960s in North America and Europe. Ford has now announced or begun building eight assembly and powertrain plants in Asia.

"We're looking at this more than just this quarter or this calendar year," Ford's Asia chief, Joe Hinrichs, said in an interview. "We're looking at this as how does Ford set itself up for success for the next several decades in Asia Pacific.

"People say, 'Are you too late?' No," he added. "You get one chance to really come at the market with the full power of Ford's product portfolio, but you want to be able to look everybody in the eye and say you truly developed the vehicles for China so it does require some patience."

Ford expects industry sales in China to hit about 30m vehicles by 2020, up from 18.5m last year.