Ford Germany Plant Closure Risk

author: FutureCar Staff    

Ford's negotiations with a Chinese investor for the sale of its plant in Germany have fallen through. As a result, the future of the production center is uncertain, with two possible outcomes: it will either be closed down in 2025 or converted into a technology center.

In an effort to reduce costs and focus on selling electric cars in Europe by 2030, Ford is shrinking its production network on the continent. The carmaker has plans to introduce seven electric vehicles (EVs) to the European market in 2025, with the electric version of the Puma crossover leading the zero-emission lineup. However, the Saarlouis plant in Germany, which currently builds the Ford Focus, a model that will be phased out in 2025, will not be producing an electric replacement.

The potential investor, whose name remains undisclosed, conducted a feasibility study and ultimately decided against proceeding with the transaction. While the identity of the investor was not revealed, sources familiar with the negotiations suggest it was a Chinese automaker. Given the interest shown by Asian carmakers in the European market, this would not have been surprising, as it is more cost-efficient to manufacture cars for Europe in Europe, just as German carmakers produce vehicles for the Chinese market in China.

Prior to the failed negotiations, fifteen potential investors had expressed interest in the Saarlouis plant. Among them were the Chinese car giant BYD and Chery Automotive, as well as a German solar panel modules manufacturer. Ford and the German state of Saarland held talks with BYD and several smaller manufacturers.

Ford is now exploring alternative plans to save the positions of 1,000 employees out of the current 4,400 working at the factory. One option under consideration is converting the car plant into a technology center. However, the fate of the plant was sealed in 2022 when Ford chose the production center in Valencia, Spain, to manufacture its next-generation electric cars.

The news of potential job losses has sparked anger and frustration among the workers at the Saarlouis plant. The union representing the employees has threatened that the move will be "expensive" for Ford. They are currently working on setting up a collective bargaining agreement to protect the workers facing termination.

FutureCar Staff