Ford seals partnership for electric cars in China
BEIJING• Ford Motor Co. is going all-in on electric cars in China, the world’s largest market for battery- powered vehicles, and it wants U.S. President Donald Trump to know about it.
The second-largest U.S. automaker said Wednesday it’s finalized an alliance with China’s Anhui Zotye Automobile Co. to manufacture and sell a full line of electric vehicles. The companies will invest 5 billion yuan (US$756 million) to develop the cars they’ll sell under a new brand unique to the Chinese market.
To underscore the deal’s significance, Ford’s top executive in Asia, Peter Fleet, is meeting with Trump and China’s president, Xi Jinping, in Beijing on Thursday, he said.
The news comes as Ford looks to accelerate its push into battery- powered cars and self- driving vehicles under new chief executive Jim Hackett.
Thursday’s meeting will be the first public outreach to Trump since Hackett replaced previous Ford CEO Mark Fields, who met several times with the president as he looked to maintain a delicate relationship with the White House. In the meeting, Fleet said he will confirm Ford’s plan for nearly US$10 billion in exports from the U. S. to China over the next three years.
Ford has said that at least 70 per cent of its own Fordbrand vehicles sold in China will offer electric or hybrid propulsion by 2025. The push to low- and zero- emission vehicles fits with China’s desire to clean up the country’s fouled air.
“Quality of life is also freedom of mobility,” Bob Shanks, Ford’s chief financial officer, said in an October interview. “We will have electric vehicles. We will have plug-in hybrids. We will have hybrids.”
Ford and Zotye plan to build a new facility as part of the 50- 50 joint venture, the U.S. automaker said. The plans still require regulatory approval.
Automakers are accelerating investments into electric vehicles to meet stricter emission and fuel- economy rules set to take effect in major markets. China is implementing a cap- and- trade framework next year that will penalize companies that don’t meet fleet-based limits through fines or buying credits.
While Ford chose to team up with Zotye and Volkswagen AG has partnered with Anhui Jianghuai Automobile Group Corp. to make electric cars, the Chinese government is discussing a plan to allow foreign carmakers to set up wholly owned electric-vehicle businesses in its free- trade zones, according to company officials briefed on the matter. Automakers like Tesla Inc. would likely benefit if China relaxes its joint- venture rule.
Besides Zotye, Ford also has joint ventures in the country with Chongqing Changan Automobile Co. and Jiangling Motors Corp. In September, Ford also announced an alliance with Mahindra & Mahindra Ltd. in India to collaborate on electric and connected vehicles.
Ford expects the market for new- energy vehicles in China to grow to six million units per year by 2025, of which about four million vehicles will be all-electric. Deliveries of such vehicles rose 53 per cent to 507,000 units in 2016, according to the China Association of Automobile Manufacturers.
In May, Volkswagen received approval for a new joint venture to produce electric cars. Daimler AG and BMW AG also have electric car brands under their partnerships with BYD Co. and Brilliance China Automotive Holdings Ltd.