China panel OK's Ford's bid to end Mazda venture
Bloomberg | 2012/8/28

(Bloomberg) -- Ford Motor Co. said it received approval from China's top economic planner to split its venture in China with Mazda Motor Corp., paving the way for the U.S. automaker to increase control of its expansion in the country.

The National Development and Reform Commission approved an application for Ford to have a separate venture with Chongqing Changan Automobile Co. instead of the current three-way ownership structure with Mazda, Ford CEO Alan Mulally told reporters Monday in Chongqing.

The plan still needs to be approved by two ministries, Ford said in a statement.

'More freedom'

The separation would restore Ford's ability to have an equal say as its Chinese partner for the first time since 2006, when the U.S. company transferred a 15 percent stake to then-affiliate Mazda. Ford has sought to break up the China venture after selling down its stake in Mazda in 2008 to raise cash.

"For Ford, they won't have to think of Mazda and will have more freedom in making decisions for future development in China," said Lin Huaibin, an analyst in Shanghai with industry researcher IHS Global Insight. "They will be able to make full use of Chongqing as a strategic production base in western China and they can focus on developing their own products suitable for the Chinese market."

Increasing its stake in the China venture to 50 percent would allow Ford to book more revenue from car sales and parts, according to Bill Russo, a senior adviser in Beijing at Booz & Co.

China expansion

Mulally was in Chongqing to attend the groundbreaking ceremony for Ford's third passenger-vehicle assembly plant in the city, which will add annual capacity of 250,000 vehicles a year when completed.

The reorganization is still subject to approval from the Ministry of Commerce, State Administration of Industry and Commerce and the Ministry of Industry and Information Technology, according to Ford.

Ford this year has disclosed moves to add production output in China, including plans to build a $760 million (4.8 billion yuan) assembly plant in Hangzhou. The company signed a letter of intent Monday to expand r&d in the country.

"We're very pleased with the restructuring and the way it's going," Mulally said Monday. "We have approval from the NDRC and we're proceeding through the regulatory process, so we're very appreciative and encouraged."

 

If the Chinese Government approves this, and I believe they will, (even though it goes against latest current policy, Ford and Mazda were in China before the halt to any new car (brand) ventures) this is good news for Mazda and the Mazda-FAW agreement.

Mazda have been wanting to split from the 3 way messy tie up with Ford and visa versa.
It served a purpose when Ford and Mazda were in bed together, now they are almost 100% divorced...so in China it will be separate factories soon.

The only other 'joint' venture ("in production") is their Thailand Plant where the Mazda BT-50/Mazda 2 and Ford Ranger/Fiesta are made.

That will be next...

 

BTW: Ford is also closing it's Philippine plant at then end of this year, supply will come out of Thailand.

 

they were trying to cut this almost fromt he moment they got it together. the chinese leg of the three way was basically asking for control and the other two said no way. the only way they could do it was to break it up. the chinese side almost immediately stole the fusion/mazda6 designs and gave it to one of the chinese competitotrs

 

Seeing that Mazda has an absolutely HUGE market in China, I couldn't be happier.