We hear about China’s booming manufacturing and production economy almost every day in the news. It is strange, therefore, to consider that many Chinese households are yet to even own their first car. As the country has experienced high levels of real growth over recent years, thousands of its citizens still live below the poverty line. But as these finally begin to improve, demand in the motor industry is picking up. Car ownership is set to soar in China over the next decade, and international motoring companies are keen to gain as much market share as possible.
Ford Motor Company (F), the latest company to announce its strategy to meet growing demand, pledged $600 million of funding to investment in Chinese factory expansion back in May – and it seems this was a good move, with sales up 8% in the country last month. The capital increase will allow Ford to produce an extra 350,000 cars per year, helping it to meet growing demand in the Chinese market. The expansion will be completed with partner firm Changan Ford Mazda Automobile, which produces the Focus Compact, Fiesta Subcompact and the S-Max small van.
Currently, Ford has a relatively small market presence in China; its sales fell to under 72,000 units in January and February this year, down 16 per cent from a year ago. This decrease occurred despite a general expansion of the automobile industry; competitor General Motors (GM) experienced rises in sales of 7.7 per cent to over 487,000 units, and overall sales were higher in the retail market than passengers expected.To continue reading, click here.