Ford Motor Co has told suppliers it plans to shift production of midsize Fusion and Mondeo sedans out of Mexico and Spain in 2020 and move it to China. The automaker said in a statement that it will not ship those cars from China to the United States and Europe.
“We have no plans to export the next-generation Fusion/Mondeo from China to North America and Europe. Fusion and Mondeo are an important part of the Ford car lineup. We will have more information to share about the next Fusion/Mondeo at a later date.”
Recent Ford documents shared with suppliers show the automaker plans to shift some Focus and Mondeo production to China, and no longer list Hermosillo and Valencia as production sites, according to sources familiar with the company’s plans.
Ford Chief Executive Officer Jim Hackett has taken a series of steps to cut the automaker’s production costs, and shift the company’s product lineup away from sedans toward sport utility and crossover vehicles, especially in North America.
Earlier this year, the company announced in a press release that Ford Focus production was moving to China from Mexico for the 2019 model year.
In that announcement, Ford said the shift would not result in any U.S. jobs being lost, and would in fact help support a $900 million investment in the automaker’s Kentucky Truck Plant.
It seems China is becoming the new location of choice for automakers seeking to lower manufacturing costs. Since assuming control of the company in May, Ford CEO Jim Hackett has taken steps to cut costs while also expanding electric and autonomous development, two areas where the automaker has trailed other manufacturers.
Through November, Ford’s total sales were down by 1.3 percent. That’s not a huge decline by any means, but the real story is that car sales overall have dropped 15.8 percent, with Fusion sales off a whopping 22 percent. Meanwhile, SUV sales have risen 2.4 percent and truck sales are up 4.9 percent.
Ford’s latest moves come as U.S. President Donald Trump has said he wants to significantly revamp or possibly exit the North American Free Trade Agreement that allows tariff-free shipments of vehicles to the United States from Mexico.