Ford Motor calls off plans for EV joint venture with China’s Zotye

Global auto manufacturer Ford Motor Company has recently announced its decision to terminate plans for an EV joint venture launch with China-based Zotye Automobile.

The auto giant revealed that its decision was prompted by significant changes in government policies and the electric vehicle industry since the agreements were initially signed with Zotye in 2017 and 2018 for battery-electric vehicle development and smart mobility, respectively. However, Ford declined to specify the exact changes that triggered this move.

Ford had recently stated that its joint venture in China with Chongqing Changan Automobile Co would initiate the production of the Mustang Mach-E all-electric vehicles.

Ford also claimed in a statement that it is planning to pursue a more flexible business model, that would facilitate the utilization of its existing operations in China and other regions, and help construct associated business centers.

Zotye declined to respond to requests for comment.

During a visit by former President of the United States, Donald Trump to China in 2017, Zotye and Ford came to a decision to invest a combined amount of $756 million, aiming for the establishment of a 50-50 JV in China to develop small electric passenger cars.

In 2018, the firms announced the signing of an MoU (memorandum of understanding) for another JV, to manufacture electric vehicles for ride-hailing fleets.

Various EV manufacturers, from home-grown firms like Nio Inc to industry-leading entities like Tesla Inc. have been making tremendous efforts to expand their production capacity in the largest auto industry in the world, where the government is encouraging the use of more sustainable vehicles as a solution for reduction of the chronic air pollution.

According to spokesperson T.R. Reid, the recent development will not affect the commitment of Ford towards producing vehicles for the largest EV market worldwide. Reid commented that if anything, the company’s intentions have become significantly more ambitious and greater than they were before, with efforts being made to find different ways to fulfill them.

Source Credit: https://www.reuters.com/article/us-fordmotor-china-zotye/ford-motor-terminates-electric-vehicle-plans-with-chinas-zotye-idUSKBN2A409A