Ford may build cars in Japan

Ford Motor Co said on Tuesday it was considering building cars at Japanese plants run by its partner Mazda Motor Corp, although both companies said no decision had been reached yet.

The financial daily Nihon Keizai Shimbun said on Tuesday that Mazda, the nation’s fifth-biggest automaker by sales, would begin making Ford cars in Japan as early as 2002.

Such a move would represent a logical progression for the two companies which have begun to share platforms – the car underbody with key engine and transmission components – making it much cheaper to build different models.

Mazda is also looking at using Ford plants in Europe, a shift that is seen as key for the export-dependant automaker which has seen its European sales suffer from the yen’s strength against the euro and the dollar.

“Mazda is also studying the possibility of building cars in Europe to cushion its exposure to currency fluctuations. Ford likewise is looking at the possibility of building cars at Mazda plants in Japan,” Ford said in a statement.

Mazda President Mark Fields told a news conference that while the two companies were exploring options, no specific decisions had been made.

The Nihon Keizai reported that Ford had proposed the Japanese carmaker to assemble the next generation of the popular Ford Focus compact and another new Ford compact with a one-litre engine.

Mazda would build 40,000 to 50,000 vehicles for the U.S. automaker each year, the paper said, adding that the next-model Focus will use the same platform as the next generation of Mazda’s mainstay Familia and Demio compact cars. It would be the first time that Mazda has built Ford vehicles.

Analysts said the reported 40,000 to 50,000 target looked very optimistic, as demand for Ford vehicles in Japan is seen at less than 20,000 vehicles annually and even counting potential exports to Asian nations and Australia.

Ford’s statement seemed to reinforce Mazda’s position as the U.S. automaker’s key production base in Asia. Reuters