Ford's German Plant Faces Closure Amidst Failed Negotiations with Chinese Investors

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 production center is facing the possibility of closure in 2025 or conversion into a technology center.

In an effort to cut costs and focus on electric vehicles, Ford is scaling down its production network in Europe. The company plans to exclusively sell electric cars in Europe by 2030 and intends to launch seven EVs in the European market in 2025. The electric version of the Puma crossover, which is Ford's bestseller in Europe, will lead the lineup of zero-emission vehicles.

The plant in Saarlouis, Germany, currently manufactures the Ford Focus, a model that will be phased out by 2025 without an electric replacement. Consequently, maintaining a car plant in the region would not be logical. A potential Chinese investor, after conducting a feasibility study, decided against proceeding with the transaction and withdrew. Ford had aimed to sign a binding preliminary agreement by September 30.

Although Ford did not disclose the name of the company it negotiated with, sources familiar with the talks suggest that it was a Chinese automaker. This aligns with the growing interest Asian carmakers have shown in the European market. Building cars for Europe in Europe would be more cost-efficient, similar to how German carmakers manufacture products for the Chinese market in China.

Earlier this year, the plant's works council revealed that fifteen potential investors had expressed interest, including BYD and Chery Automotive, both Chinese car giants. Ford and the German state of Saarland held discussions with BYD, several smaller manufacturers, and even a German solar panel modules manufacturer.

Ford's Europe passenger cars boss, Martin Sander, informed the workers at the plant that the company is exploring alternative plans to save the positions of 1,000 employees out of the current workforce of 4,400. One option under consideration is converting the car plant into a technology center.

The decline of the Saarlouis plant began in 2022 when Ford chose the production center in Valencia, Spain, to manufacture its next-generation electric cars. The union representing the workers at the site expressed anger and frustration, warning that the move would be costly for Ford if a large number of employees were to lose their jobs. The union is actively working on establishing a collective bargaining agreement to protect the workers facing termination.

FutureCar Staff