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March 15, 2021 09:04 AM

Ford mulls repurposing Europe plants in EV shift

Nick Gibbs
Automotive News
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    Ford could repurpose some European plants to make e-components such as e-axles, which Ford already produces for the Mustang Mach-E full-electric crossover in the U.S.

    Ford Motor Co. of Europe could further downsize its production capacity and might "repurpose" factories as it refocuses its business to concentrate on light commercial vans and profitable car lines.

    Ford's European arm already has undergone a two-year restructuring program that saw it shutter or sell five plants including three in Russia, reduce production shifts in its remaining factories and cut 20 percent of its work force in a bid to reverse years of financial losses.

    "The restructuring program was very significant," Ford of Europe President Stuart Rowley told Automotive News Europe in an interview. "But the next phase of the transformation, however, is going to require further action that could mean rescaling or repurposing facilities or other changes."

    Ford rival Renault is planning similar steps to help reduce excess capacity while retaining jobs. Renault said in November that it will convert its factory in Flins, France, into a facility for recycling, retrofitting and research.

    Rowley said Ford of Europe could exit certain passenger car segments as part of its plan to sell only battery-powered cars in Europe, which means that it will drop gasoline and diesel passenger cars including hybrids by 2030.

    "We will choose segments where there is consumer demand, growth and where we can be profitable," Rowley said. "We will not necessarily try to be all things to all men or women in the future."

    The move toward electrification has forced Ford to reconsider its network engine and transmissions factories.

    Last year production ended at Ford's engine plant in Bridgend, Wales, while Ford and Magna International Inc. agreed to end their joint transmission production venture (formerly Getrag-Ford) on March 1.

    Ford has taken control of transmission plants in Halewood, England, and Cologne, Germany, while Magna has control over a transmission plant in Bordeaux, France.

    Rowley indicated that Ford could repurpose some plants to make e-components such as e-axles, which Ford already produces for the Mustang Mach-E full-electric crossover in the U.S. "As we transition, there are going to be fewer powertrain plants, equally, we may invest in electric components," Rowley said.

    Ford said last month that it will invest $1 billion in an electric vehicle manufacturing center at its factory in Cologne, Germany, which currently builds the Fiesta small car. The plant will build an EV using Volkswagen Group's MEB platform starting in mid-2023. The new model is expected to secure the factory's future.

    Ford's plant in Craiova, Romania, is also secure because of the recent addition of the Puma small crossover, which is starting to overtake the Fiesta in sales. "Romania is very cost competitive and that is an important asset we have," Rowley said.

    Ford's plant in Valencia, Spain, builds the Kuga compact crossover, which went into production in 2019, but the future of the Mondeo midsize range and the Galaxy and S-Max minivans, also produced there, is in question because those models compete in shrinking segments.

    Reports suggest Ford is preparing a crossover-styled vehicle to replace the Mondeo.

    Ford stopped building the C-Max compact minivan at its factory in Saarlouis, Germany, in 2019 and cut shifts from three to two. The plant now builds just the Focus compact car, and Rowley declined to talk about the plant's future.

    "Cologne won't be the last plant to electrify. We will make more announcements as we move forward and start to make investments," he said.

    Rowley said that Ford's Dagenham engine plant in England will have a "longer runway" to adapt to electrification because it largely builds diesels for the auto maker's Transit range of vans. "Dagenham is still a very important part of our future commercial vehicle business," he added. "The core of our business in Europe and our profitability is commercial vehicles," he said.

    Ford's restructuring, which removed $1.1 billion of structural costs, helped the company to its highest quarterly profit in Europe in four years in the last three months of 2020, the company said in February.

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