Ford Motor and its partners in China will build the U.S. automaker's first transmission plant there in a move to support Ford's growth in the world's largest auto market.
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Vladimir Artev | Epsilon | Getty Images |
Ford [F 15.12 
0.15 (+1%) 
] said Thursday its passenger-vehicle joint venture in China,Changan Ford Mazda Automobile, signed a memorandum of understanding for the plant with the Chongqing municipal government.
The initial investment, funded by the joint venture, is $350 million. Construction will begin in July.
The plant will make six-speed automatic transmissions and is scheduled to start production in the fourth quarter of 2013.
It will have an initial annual capacity of up to 400,000 units for Ford-brand vehicles made and sold in China, Ford said. The factory will be located in Chongqing's New North Zone.
Ford, which sold 582,500 vehicles in China last year, is pushing to catch up to rival and market leader General Motors [GM 31.52 0.42 (+1.35%) ], which has announced plans to double its sales in China to around 5 million vehicles by 2015. Ford said in April it would bring 15 new vehicles, double its dealerships from 340 and add 1,200 new jobs in China by 2015.
"This transmission plant investment represents yet another important milestone in Ford's accelerated growth plan for this important market," Joe Hinrichs, president of Ford Asia Pacific, said in a statement.
CFMA, which makes the Ford Mondeo, Focus Fiesta and S-Max vehicles, will start production later this year on a $500 million engine plant in Chongqing. It plans to begin production at that factory, with an initial annual capacity of 400,000 units, in 2013.
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