April 7, 2017

The Detroit-based company will start building the Mondeo Energi plug-in hybrid in China next year as well as an unannounced all-electric SUV in the next five years.

The new ‘manifest destiny’

Foreign automakers have been reluctant to jump into the Chinese market despite its sheer size – not only does the government mandate local joint ventures (just like it did with consumer electronics), but there are worries that intellectual property protection isn’t adequate in China.

That’s why manufacturers have held back from building EVs in China, and that’s why with the exception of Tesla, all EVs sold in China are exclusively made by Chinese companies. China offers lucrative subsidies and benefits for EV manufacturers and consumers while imposing a 25 percent tariff on imported vehicles. No wonder then foreign EVs don’t sell well in the world’s largest auto market.

Well, that might change soon. According to Gao Fend Advisory, a Shanghai-based consulting firm, it is “manifest destiny” for foreign car companies to shake off these fears and start EV production in China. Already, Buick has announced its plans to build plug-in hybrid and electric cars in China, and its parent company GM has reaffirmed its ambition to sell EVs in the country. Volkswagen is also said to be in the process of setting up a local joint venture.

And Ford is next, it looks like.

Welcome to Changan Ford

Ford’s local joint venture – Changan Ford – has announced that it will start building the Mondeo Energi plug-in hybrid inside China starting next year. Not only that, the company plans to build and launch a yet-to-be-announced all-electric SUV. According to the company, by 2025, all vehicles manufactured by Changan Ford will come in electrified versions.

China is not only the largest market for cars but also for EVs according to the China Association of Automobile Manufacturers. With heavy subsidies from the government and growing environmental concerns within the country, the green boom is set to grow even further. That means EV manufacturers might benefit from jumping into the market before it’s too late, and Mark Fields, CEO of Ford, certainly seems to think so:

The time is right for Ford to expand our EV lineup and investments in China.

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