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Mexico Loses Assembly Operation for Ford Focus to China

ISSN:1054-8890
LADB Article ID: 80330
Category/Department: Mexico
Date: 2017-06-28
By: Carlos Navarro

In a second major blow to the Mexican auto industry this year, Ford Motor Company announced in mid-June a plan to transfer assembly operations of the Ford Focus from its plant in Hermosillo, in Sonora state, to a new facility in Chongqing, China, effective in 2019. This is the second major shift that Ford has announced this year. In January, the company cancelled plans to build a US$1.6 billion assembly plant in the community of Villa de Reyes, in San Luis Potosí state. The move to cancel the San Luis Potosí plans was due in part to pressure from a recently elected Donald Trump, who in his campaign for the US presidency had threatened to impose high tariffs on imports of vehicles assembled in Mexico. At the time, Ford was already having second thoughts on constructing the new facility, as demand for small vehicles had declined in the US. Economic observers said that Ford’s move to China is rooted in same economic factors that forced the cancellation of the facility in San Luis Potosí. “Ford’s plan to shift the Focus to China is a sign of the weak demand for small cars in the United States and of the growing importance of China, which is the largest auto market in the world. US sales of the Focus are down 20% so far this year,” the online financial site CNNMoney reported.

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