China may become the next location for a factory that will manufacture Ford electric cars, Alan Mulally, CEO of the Ford (NYSE:F), revealed recently. The plan of the company is to offer into the market vehicles that are in demand not only in China but the rest of the world as well. Even as Mulally gave this revelation, the schedule for the manufacture of the Ford electric cars was not yet disclosed by the company.
These statements in relation to the Ford electric cars came as an agreement was signed by GM (NYSE:GM) last September 20 with SAIC Motor Corp to create electric cars even as the company is set on offering the Chevrolet Volt in the later part of the year in China.
Aside from the Ford electric cars, the Lincoln luxury brand of the company is also being taken into account for launch in the company as Mulally indicated that the demand for these vehicles in China will likely be significant.
Ahead of the plans for the Ford electric cars, the Ford Focus and Mondeo are currently being offered in China by the company. Around $1.6 billion is set to be spent by Ford for the construction of the factories in China as the company intends to increase its vehicle offering in the country to fifteen models by the middle of the decade.
The European and US market are currently the main source of sales for the company as it only had 2.7 percent share of the Chinese passenger vehicle market prior to the announcement of the possible manufacture of the Ford electric cars within China.
The company intends to increase its international sales by around fifty percent through an expansion in Asia prior to the offering of the Ford electric cars. Sales in China for Ford have increased by 11 percent. Total vehicle sales across China last year was at around 18 million units as it was increased by rural subsidies and tax breaks from the government.
However ahead of the possible manufacture of the Ford electric cars within the country, the company has experienced pressure on its price with the slowdown in the automobile market. The increase in interest rates and the removal of the sales tax breaks is projected to affect the growth in vehicle deliveries in China. However according to Mulally the country has a good plan to manage inflation and sustain growth as the company prepares for the eventual production of the Ford electric cars.
