Mazda will start building cars at a Ford factory in Europe from early in 2002, with a target of 100,000 a year from 2003.
First into production will be the Demio replacement, to be followed in 2003 by the next generation 323 5dr. Both models will share a platform with Ford models. Ford is understood to be developing a Fiesta-based MPV which could share its platform with Demio.
Union pressure for the models to be built at the Dagenham car plant has been rejected by Ford. Valencia is seen as the most likely plant.
The decision by Mazda to build in Europe is a hedge against currency fluctuations – a strong yen and weak euro is hitting Japanese manufacturers hard.
Mazda will close its U2 plant in Hiroshima, Japan, which produces around 260,000 cars a year to balance its worldwide production.
The company's 121, a rebadged Ford Fiesta, had been built at Dagenham which is due to close as an assembly plant in 2002.