For the first time ever, Ford will import Chineese-made vehicles to the US. In an annoucement to the public Tuesday, the automotive company said they will be moving production of the Ford Focus from the states to China. The influx of new jobs will be welcome news to the Chinese but how will it affect US workers?
A report from the Detriot News suggests these types of moves foretell the eventual demise of the American-made vehicle. In January President Trump criticized Ford’s decision to move jobs to Mexico and took credit when Ford’s CEO Mark Fields announced they were canceling their plans of building a production plant in Mexico.
Ford has promised that the China move will not affect any jobs in the states. The move is slated to begin in 2019.
The Chinese plant is expected to produce 80,000 vehicles within the first year of production. This is the first production plant change under new Chief Executive Jim Hackett, who replaced Fields when he left the company in May, according to the New York Times.
As Ford’s profit margins and sales of their vehicles continue to narrow, moving production to China may be their effort to innovate their product, and at the same time, minimize their loses if sales continue to dwindle.
According to Reuter, Americans are choosing more expensive SUVs and and trucks opposed to smaller cars. Ford told their investors Tuesday that they would be investing $900 million in a Kentucky plant, which would primarily be focused on producing the new Ford Expedition and Lincoln Navigator.
The sale of the Ford Focus in the US has dropped 22 percent, which also contributed to the decison to move the production of the small car overseas. In a statement from Ford, they announced “additional variants” of the next-generation Focus will be shipping from China to the US and Europe in 2019.
Ford, the nation’s second-largest automaker behind General Motors, stock reacted poorly after the news of the plant moving to China as it has dropped down 0.5 percent.