US carmaker Ford Motor Co last Friday started constructing a new $490 million plant in Chongqing with local partner Chang'an Motor Corp and Japan's Mazda Motor Corp to further tap the world's biggest and fast-growing vehicle market.

The new plant, part of the three-way joint venture Chang'an Ford Mazda Automobile Co, will have an initially production capacity of 150,000 cars a year when it is completed in the southwestern municipality in 2012, according to a statement from Ford.

The new factory will increase the joint venture's annual production capacity to 600,000 units in 2012.

The first model to be made at the new plant will be a new-generation Ford Focus compact.

Chang'an Ford Mazda, with existing plants in Chongqing and Nanjing in east China, is making Ford's Focus, Mondeo and Fiesta, Mazda2 and Mazda3 as well as models from Ford's Swedish affiliate Volvo. Mazda is 13 percent owned by the Detroit-based auto group.

Ford President and CEO Alan Mulally said the new plant "reinforces our commitment to further expanding our China operations to meet the continued rise in demand from Chinese consumers".

Ford's China sales grew by 14 percent year-on-year to almost 200,000 vehicles in the first half of this year. But the number lags far behind market leaders General Motors and Germany's Volkswagen Group.

In the first eight months of this year, overall sales of China-made vehicles surged by 29.2 percent to 8.33 million units from a year ago. Sales for the full year are projected to hit 12 million vehicles, up from 9.38 million units in 2008.

Robert Graziano, chairman and CEO of Ford Motor China, said that the US group would introduce at least four new models into the joint venture within the next three years.

"We will introduce our EcoBoost engine technology in China next year, as well as other fuel-efficient technologies such as our PowerShift transmission," Graziano said.

The EcoBoost engines, which combine turbocharging and direct-injection technology, reduce fuel consumption and CO2 emissions by up to 20 percent when compared with conventional, larger-displacement gasoline engines with similar power.

Xu Liuping, president of Chang'an Motor Corp, said he expects Chang'an Ford Mazda to grab 5 percent of China's passenger car market by 2014.

The fourth-largest Chinese auto group, Chang'an has a 50 percent stake in the joint venture with Ford owning a 35 percent and Mazda 15 percent.

Inspired by robust growth of China's vehicle market, a range of other global automakers announced new local investment and facility plans earlier this year, such as Volkswagen, General Motors and Nissan.

Ford's announcement of the new plant in China came just two days after it revealed plans to launch a new smaller car - the Figo - early next year in India, another bright spot in the gloomy global vehicle market.

(China Daily 09/28/2009 page6)