Ford says it will be pulling out of the Indonesian and Japanese markets this year, stating that it saw “no reasonable path to profitability” in both countries, where the brand has long struggled to gain any significant purchase.
According to Reuters, the news of the exit came in the form of an email from Asia Pacific president Dave Schoch to all employees in the region, which the news agency said it viewed. In both countries, the moving out will be complete – it will close not just its offices but all dealerships as well, and stop the sales and imports of Ford and Lincoln vehicles.
Another news report states that the brand will make its exit from both markets before the end of 2016, but will honour its commitment to existing customers with regards to vehicle servicing, parts replacements and warranty claims.
Ford entered the Indonesian market in 2002, and sells its vehicles through 44 franchised dealerships. In 2015, the brand shifted just 6,000 vehicles, which was 0.6% of the total new car market in the country, which is struggling from an economic slowdown. It currently employs 35 staff in the republic.
“In Indonesia, without local manufacturing, there’s just really no way that automakers can compete in that market, and we do not have local manufacturing,” a Shanghai-based Ford spokeswoman told Reuters.
Its withdrawal from Indonesia follows in the footsteps of General Motors, which closed its manufacturing facility in the country last June. The decision to shut its Bekasi, Indonesia plant resulted in terminating about 500 jobs in the process, but GM at least continues to maintain a presence in the market, as a national sales company.
As for Japan, the Blue Oval began operations there in 1974, and presently has 52 dealerships in the country and a staff count of 292. The company has had a tough time selling its Fiestas, Mustangs and Explorers in the market, and only managed to shift around 5,000 vehicles last year, which was about 1.5% of the imported new car market volume. Ford said that product development carried out in Japan will be shifted elsewhere.
“Japan is the most closed, developed auto economy in the world, with all imported brands accounting for less than 6% of Japan’s annual new car market,” Ford spokesman Neal McCarthy told CNBC in an email. He added that the advent of the Trans Pacific Partnership (TPP) trade agreement in its current form will not improve the brand’s ability to compete in Japan.
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Ford Malaysia will also suffer the same fate with the Ford Motor Indonesia if it does not have a product that can compete with Perodua
Malaysia so small yet so good..everyone is surviving well except local main manufactur PROTON.
God kompeni is loosing to crony Honda
Ford sold 800K passenger car in China rank #8 better than Honda #9, so by your logic chinese dunno know any tech stuff?
Yes, China ppl love to buy china brand & volkwagen. Japanese brand not doing very well there.
Many Chinese anti Japanese products, that is the reason why the Japanese companies are not doing so well in China
it is actually quite a shock in Indo that ford are puling out because ford cars such as fiesta and ecosport are quite a common scene for the last 5 to 6 years in the street of Jakarta and 6000+ sales is much better sales than that of chevy, hyundai and kia although still far behind toyota and honda of course, and ford did not have that mpv line in Indonesia. I do think its because ford did not launch their full change model of fiesta, the fiesta used to be the top three in sub compact hatchback car market in Indonesia, now, since they only do facelift back in 2014 and the japanese manufacturer has already sold newer more advanced model fiesta’s lost its market share to yaris, jazz, and mazda2.
The Indonesians prefer something big & cheap. Like Avanza & Kijang Innova. No such product in Ford’s lineup. Pick-up truck also not popular there.
The weird thing is Fords are cheaper in Indonesia.
An Ecoboost Fiesta cost the same price or cheaper as a Proton Saga here in Malaysia.
Can’t say much about Japan, they have a solid local lineup of cars which are home grown so why want to get imports then? As for Indonesia, yes they do not have any similar product to compete with Avanza or Kijang so there goes their business in that country. It’s also worth to know that Ford is doing better than VW here in Bolehland heck even Mercedes and BMW sold more cars than VW last year!
Not true, VW sold more passenger cars than Ford in Malaysia last year. Ford numbers are high only because of its commercial vehicles. Its passenger cars sell less than Peugeots in Malaysia. In Japan, VW is the top selling European passenger car sold there. In the luxury division, BMW, Audi and Mercedes sells very well in Japan.
Volkswagen sells 4,000 more cars than Ford in Malaysia. Check the YTD figures for passenger cars sales in Malaysia here:
http://paultan.org/2016/01/21/dec-2015-sales-proton-fourth-behind-toyota-honda/
This made business sense to close shop if it is not profitable or there’s no growth in sight. No bailout or protectionist policy to protect Ford interest despite Ford can say that closing shop will make many employees, sub-cons, suppliers etc etc bankrupt UNLIKE HERE. If only the jaguh kampungs practise such policies, then the country don’t have to bailout billions for so many years ……
to be honest whole ASEAN is Japanese playground, period.
And the japanese are happy to rip you off with their overpriced old tech tin kosong…
All Fords go to hell.
My wife’s Honda City is better than this junk!!
Fords better be scrapyard like my Ford Escort!