Chongqing Changan Automobile of China is in talks with Ford to produce a mid-sized car in China using Ford technology but wearing a Changan badge. Changan, one of the top state auto groups in China but lagging in its own brand models, is currently the assembler of Ford cars such as the Focus, Mondeo and Fiesta.
Ford CEO Alan Mulally recently met up with Changan Chairman Xu Liuping to discuss ways to bring their cooperation to the next level. The rebadging of a mid-sized sedan (mid-sized in China refers to the Camry/Accord class, so it could be the Mondeo) from Ford was one of the ideas that arose, to be built at Changan’s plant in Nanjing, according to sources close to the matter.
The reworked sedan will be sold at a lower price and equipment than its Ford equivalent to avoid competition. This deal will be mutually beneficial as Ford will receive a sizable chunk of proceeds. Currently, Changan has no presence in the said segment.
Perhaps Ford is looking enviously at its fellow Detroit carmaker GM, which has a super successful tie up with SAIC. A relative newcomer to China and quite a long way from challenging GM and Volkswagen in the world’s largest car market, Ford is hoping that its partnership with Changan will blossom. “The Changan deal may not add much value to Ford’s only brand in the short term, but it could be the first step toward a wider and deeper relationship like GM and SAIC,” said Huang Zherui, an analyst with global industry consultancy CSM Worldwide.