Detroit heavyweight Ford (NYSE:F) revealed on Thursday plans to build its first transmission plant in China as part of its goal to expand in the world’s largest auto market.
Ford's president of Asia Pacific and Africa, Joe Hinrichs, said the investment demonstrates the company's “unprecedented commitment to the China market.”
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Ford and China’s joint venture Changan Ford Mazda Automobile [CFMA] inked a memorandum of understanding for the project with the Chongqing municipal government.
The plant, which will be located in Chongqing’s Now North Zone, will be funded entirely by the joint venture, with an initial investment of $350 million.
“This transmission plant investment represents yet another important milestone in Ford's accelerated growth plan for this important market,” Hinrichs said.
The plan in the latest in a slew of investments made by Ford and its partners in China as part of the automaker’s goal to introduce 15 brand new vehicles to China by 2015. Last year, Ford signed a deal with the same municipal government to build a new engine plant. It also plans on building a new passenger car plant in Chongqing.
The facility will produce advanced fuel-efficient 6-speed automatic transmissions with an initial annual capacity of up to 400,000 units, supplying Ford brand vehicles, including the Mondeo, Focus, Fiesta and S-Max, produced and sold locally by CFMA.
Construction is slated to begin this July with production set to start in the fourth quarter of 2013.