Manufacturing News

Mazda, Ford, Chinese partner propose to restructure

Mazda Motor Corp. and its China venture partners are awaiting government approval for a restructuring, the Japanese automaker said after talk resurfaced about a possible termination of the three-way tie.

The future of the Changan-Ford-Mazda partnership had been in focus since Ford Motor Co. cut its controlling one-third stake in Mazda to 13 percent in 2008 to free up cash.

One option was to split the venture into two 50-50 ties between Chongqing Changan Automobile Co. and its two foreign partners, industry watchers had speculated.

Mazda declined to comment on such a possibility but said in a statement that the partners had submitted a restructuring plan for the venture to the government which would further strengthen their business in China.

"The three-way partnership (Changan, Ford, Mazda) has been successful over the years. However, all partners are constantly assessing new opportunities to further optimize our business structure and operations so as to continuously improve our products and services to further satisfy our growing customer base in China," the statement said.

The venture is considering expanding its 160,000-unit plant in the eastern city of Nanjing, which also needs the government's approval, a Mazda spokeswoman said, declining to give further details of the restructuring plan.

A Ford spokeswoman said she was not aware of the matter. A Changan executive declined to comment but said a split was a good move for all the three partners.

Mazda started making the Mazda6 in China in March 2003 through a technical cooperation pact with FAW Group, China's No. 2 automaker.

Three years later it joined Ford and Changan's car production venture, which now makes the Mazda2 and Mazda3 as well as Ford's Focus, Fiesta, Mondeo, S-MAX, Volvo S40 and S80 models.

Later this year, the Mazda3, which was previously made in the venture's Chongqing plant, will be manufactured at the Nanjing plant, which now produces Ford's Fiesta and the Mazda2 subcompacts, according to the Japanese automaker.

Ford is currently selling its Volvo car unit to China's Zhejiang Geely, parent of Geely Automobile Holdings.

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