CHANGAN, FORD AND MAZDA PARTNERSHIP TAKES ANOTHER MAJOR STEP FORWARD IN CHINA
Mazda takes equity stake; restructured company is renamed Changan Ford Mazda Automobile Company, Ltd.
APRIL 4, 2006 — Mazda Motor Corporation announced today that the Chinese government has approved Mazda's investment in Changan Ford Automobile Co., Ltd. (CAF), the joint venture between Changan Automotive Group and Ford Motor Company, and the new, restructured business has been renamed Changan Ford Mazda Automobile Co., Ltd. (CFMA). With the completion of the investment fund transfer, this equity restructuring marks another major step forward in the three-party partnership in China.
Changan, Ford and Mazda hold 50 percent, 35 percent and 15 percent shares in CFMA, respectively. The 15 percent share now owned by Mazda in CFMA was transferred by Ford from its 50 percent share originally held in Changan Ford.
“We are pleased that Mazda’s investment in Changan Ford was completed smoothly. With this move, the fundamentals of cooperation among Mazda, Ford and Changan will be further strengthened, and the progress on the three-party joint projects in Chongqing and Nanjing will be accelerated. Moreover, this will also expand the possibility of further cooperation among the partners," said Kiyoshi Ozaki, Mazda’s Director and senior managing executive officer in charge of China business strategy . “We believe the three-party joint venture has built a sound foundation for Mazda to achieve our mid-term goal of producing and selling 300,000 units in the Chinese market by 2010. This would not be possible without the great support of the Chinese government and each partner in China, which I deeply appreciate . ”
"The equity restructuring of Changan Ford has lifted the partnership among Ford, Mazda and Changan in China to a closer and more substantial stage," said Mei Wei Cheng, Chairman & CEO of Ford Motor (China) Ltd. "I have no doubt that the three-party joint venture will fully combine the advantageous resources of three parties so as to provide more new and exciting products to Chinese customers. I also strongly believe the company will grow quickly to become one of the top tier auto manufacturers in China."
"The restructuring of Changan Ford with Mazda's participation is the result of joint efforts and great partnership of Changan, Ford and Mazda. This shows the three parties have entered into a new stage of cooperation in terms of brand, technology, marketing, and resources sharing," said Yin Jiaxu, Deputy General Manager of China South Industries Group Corp., Chairman of Changan Automotive Group, as well as Changan Ford. "Changan will further its cooperation with Ford and Mazda in order to deliver high quality products to meet customer needs. Meanwhile, Changan will work closely with its partners to build up a brand new model of operation to maximize each party's benefits."
The long-term, strategic partnership among Changan, Ford and Mazda in China has been developing quickly over the past two years. The three parties are also jointly expanding the capacity of the Chongqing assembly plant, which now claims an annual capacity of 150,000 units and will be further expanded to 200,000 units by May this year. Part of the expanded capacity in Chongqing, in addition to Ford Focus production, is being used for the production of Mazda3 and the Volvo S40.
The three parties are also jointly building a brand new vehicle assembly plant in Nanjing, which will become the second manufacturing base of CFMA and will produce both Mazda and Ford brand vehicles. The Nanjing assembly plant is expected to be operational in 2007, with an initial annual capacity of 160,000 units. Adjacent to the Nanjing assembly plant is the three-party joint venture Changan Ford Mazda Engine Co., Ltd. (CFME), which is well underway to being operational in 2007. The engine company will produce world-class engine products for both Ford and Mazda brands and will supply the three parties' vehicle assembly operations in China.