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Ford defends slower pace

Ford yesterday defended the pace of its expansion in China, where it lags its global rivals, saying the mainland market was still at an early stage of its growth and development of brand loyalties.

The carmaker plans to build 65,000 passenger cars at its flagship plant in Chongqing, western China, this year, and has announced it will spend $1bn (£54.7m) to increase capacity to more 100,000 units.

Mark Schulz, the chairman of Ford, Asia-Pacific and Africa, said at a press conference on the eve of the opening of the Beijing auto show the company "would like to move faster but our primary aim is to build a solid foundation".

"We have learnt that long-term success takes prudence and patience," says Schulz.

The company refused to comment on reports that Mazda, the Japanese automaker in which Ford owns a one-third stake, would take a leading role in a planned new $638m (£349m) car and engine plant in Nanjing, near Shanghai.

However, executives of the Japanese company, which now licences production of a number of its models to Chinese manufacturers, confirmed they were seeking a greenfield factory site.

The Japanese media report said the Nanjing plant would have capacity for 200,000 cars and 400,000-500,000 engines. Changan, Ford's joint venture partner, already makes engines in Nanjing.

"It's safe to say the proposed plant in Nanjing will be similar to Chongqing," says Ron Tyack, the president of the joint venture, Changan Ford.

"Most assembly plants are in the vicinity of 150,000-200,000 units."

The relatively slow pace of Ford's expansion in China, the world's fastest growing auto market, has been contrasted with the plans of its competitor, General Motors, which announced this week it would double capacity by 2007 to 1.3m units.

The target sales for all of Ford's joint ventures, in passenger cars and trucks, this year is 200,000 units, which would give it a market share of just less than 3%.

Once the Nanjing plant wins approval, the total capacity of Ford's joint ventures in China will be about 600,000 units.

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