Automaker Ford has announced on Tuesday it will shift the production of the next-generation Focus model for American consumers in China rather than Mexico, as a way to reduce costs. Exports of the model from China to North America are expected to commence in 2019.
The next generation of the Focus model was initially expected to be produced at the company’s Hermosillo plant, located in the city of same name in the Mexican state of Sonora. Ford was building a $1.6 billion assembly plant in San Luis Potosi, Mexico, for the model to US consumers, but it canceled the project.
“The new North America Focus production plan saves $1 billion in investment costs versus the original plan – $500 million [in Mexico, with the shift of output to China] on top of the $500 million savings announced earlier this year by cancelling plans for an all-new manufacturing facility in San Luis Potosi, Mexico,” the company said on Tuesday.
“Ford is saving $1 billion in investment costs versus its original Focus production plan, improving the financial health of its Focus business and further improving manufacturing scale in China – all helping create a more operationally fit company,” it added.
Ford’s Mexican division told Reuters it expects “no immediate impact on our levels of employment as a result of this decision.”
“We will continue producing the Fusion and the Lincoln MKZ and its hybrid versions in Hermosillo,” the company added.
“Finding a more cost-effective way to deliver the next Focus program in North America is a better plan, allowing us to redeploy the money we save into areas of growth for the company,” said Joe Hinrichs, Ford executive vice president and president, global operations.