As sales fall, Ford’s China JV ends contracts with agencies

BEIJING: Ford Motor Co’s joint venture with China Changan Automobile Group has decided not to renew its contract with some agencies supplying it with workers, as carmakers struggle to cope with slumping sales in China.

The New York Times reported earlier that the Ford-Changan joint venture has “quietly begun” dismissing thousands of its 20,000 workers in the world’s secondlargest economy.

Ford did not comment on how many of its workers were being supplied by the agencies.

China’s car sales fell 2.8 per cent in 2018, according to China’s Association of Automobile Manufacturers (CAAM), marking

Ford suffered an even deeper sales slump of 36.9 per cent last year in China, due to lack of new and significantly redesigned models, especially SUVs for the market.

the first contraction since the 1990s. Slowing economic growth as well as the fallout of trade frictions with the United States have hurt demand.

Ford suffered an even deeper sales slump of 36.9 per cent last year in China, due to lack of new and significantly redesigned models, especially SUVs for the market.

Company executive told Reuters last year it was unlikely that Ford’s sales will regain momentum in China until later in 2019 when the first new vehicle models arrive in showrooms in large enough numbers.

Beijing has in recent months pledged various measures to boost private consumption to prop up growth, including subsidies to boost rural sales of some vehicles and purchases of new energy vehicles. January’s car sales fell 15.8 per cent from a year earlier, however, and CAAM does not expect annual sales growth in 2019.

Last month, Chongqing Changan Automobile Co. said in a filing that its profit for 2018 may have tumbled as much as 93 per cent. Sales at its joint venture with the American maker slumped 54 per cent to 377,739 units last year, a level not seen since 2012.

Ford earlier this month reported a net loss in the fourth quarter, citing China as a particular trouble spot. It lost US$381 million in the quarter and US$1.1 billion for the year in its Asia-Pacific business. The models the carmaker makes in China include the Mondeo, Kuga and Focus.