Ford Motor is in talks with local partners to introduce indigenous brands in China as it plays catch-up in the world's biggest auto market with the likes of General Motors and Volkswagen, its China chief said on June 04.
Such a move would see Ford join other foreign car makers in launching indigenous China-only brands, in part to comply with government rules that allow them to make cars on the mainland.
"We are always in discussions with our joint-venture partners," David Schoch, chairman and CEO of Ford's China operations, told Reuters in an interview in Taipei.
"All I can tell you is we are studying indigenous brands, but our total focus in terms of brand enhancement is really on the Ford brand."
China's vehicles market, which includes cars, vans and trucks, will likely expand by around 5 percent this year and that pace of growth was likely to be sustained over the next few years, Schoch added.
China's 2011 vehicles sales stood at 18.5 million. Ford, which makes its Fiesta, Focus, Mondeo and other sedans in China in a three-way tie-up with Chongqing Changan Automobile Co Ltd and Japan's Mazda Motor Corp, is a relative latecomer in China, where General Motors and Germany's Volkswagen have a sizeable lead.
It also holds 30 percent of Jiangling Motors Corp , which makes Ford's Transit vans.
Typically, China-only brands use older technology that foreign companies no longer use, enabling them to keep vehicle costs lower and at the same time help Chinese partners learn the ropes in developing and marketing modern cars.
Ford, which avoided a bankruptcy filing and was the only US auto maker not to take a government bailout in 2009, shipped 519,390 passenger cars, including sedans, sports utility vehicles and multi-purpose vehicles, to dealers in China in 2011, up 7 percent from a year earlier.
Schoch said Ford's car sales in China would outpace the China auto industry's growth forecast of 5 percent for this year, but he declined to provide a specific figure. His forecast was at the lower end of a projection of 5-10 percent he made earlier this year.
"That is still fairly rapid growth and we don't expect to see the rapid growth that we saw in 2008, 2009 and 2010," he said. Car sales in China climbed 5.2 percent in 2011, the slowest pace since the nation's car culture took off at the turn of the century, as consumers shunned local brands after Beijing scrapped tax incentives for small cars.