Ford Motor Turns to Industry Outsider to Reverse China Slump

Mr. Chen, an industry veteran who began his career at Ford, returned to head the China operations in October 2018 following a 30% year-over-year drop in sales during the first nine months of that year. Ford’s share of passenger car sales in China had already slumped to 18^th place in the first quarter of 2018 from sixth four years earlier, according to research firm LMC Automotive. 

Despite rolling out new models tailored for the Chinese market, Ford’s sales haven’t recovered. The market share for Ford’s largest joint venture in China, with

Changan Automobile Co.

, shrank to 1% from 4% between 2016 and 2022, according to industry data and Changan-Ford’s company filings. 

From a peak of more than 900,000 units in 2016, sales from the joint venture last year dwindled to about 250,000, according to Changan’s filings to the Shenzhen Stock Exchange. Ford doesn’t publish a detailed breakdown of its China sales.

China, including Taiwan, was the only unprofitable region for Ford’s automotive business last year. Losses there widened to $572 million from $327 million a year earlier, according to company filings. 

During an earnings call in October in which he also addressed weaknesses in Ford’s European performance, Mr. Farley said the losses were due to increased investment in developing electric vehicles.

“I can’t overstate the sense of urgency we have to address these critical operating areas,” he said.

Mr. Farley is also attempting to steer the iconic auto maker’s transition to electric vehicles, where China leads the way in both domestic market sales and battery development. A major part of that challenge is to wean American drivers off their gas-guzzling motors—including top-selling Ford F series trucks—onto electric models. 

In a bid to shore up its supply chain to include electric-vehicle batteries, Ford said last week that it reached a deal with Chinese battery manufacturer

Contemporary Amperex Technology Co.

to invest $3.5 billion in a battery plant in Michigan. The plant will employ thousands and will be wholly owned by Ford, but it will use knowledge and expertise provided by the world’s largest battery maker, the company said. 

That deal has put the spotlight on Ford’s China ties as a strategic rivalry over technology grows between Washington and Beijing. 

U.S. Sen.

Marco Rubio,

a Republican from Florida, said he was alarmed by the Ford-Contemporary Amperex Technology partnership. He called for a review of the deal and urged the Biden administration to ensure it didn’t receive tax credits or government funding.  

Write to Selina Cheng at [email protected]

Mr. Chen, an industry veteran who began his career at Ford, returned to head the China operations in October 2018 following a 30% year-over-year drop in sales during the first nine months of that year. Ford’s share of passenger car sales in China had already slumped to 18^th place in the first quarter of 2018 from sixth four years earlier, according to research firm LMC Automotive. 

Despite rolling out new models tailored for the Chinese market, Ford’s sales haven’t recovered. The market share for Ford’s largest joint venture in China, with

Changan Automobile Co.

, shrank to 1% from 4% between 2016 and 2022, according to industry data and Changan-Ford’s company filings. 

From a peak of more than 900,000 units in 2016, sales from the joint venture last year dwindled to about 250,000, according to Changan’s filings to the Shenzhen Stock Exchange. Ford doesn’t publish a detailed breakdown of its China sales.

China, including Taiwan, was the only unprofitable region for Ford’s automotive business last year. Losses there widened to $572 million from $327 million a year earlier, according to company filings. 

During an earnings call in October in which he also addressed weaknesses in Ford’s European performance, Mr. Farley said the losses were due to increased investment in developing electric vehicles.

“I can’t overstate the sense of urgency we have to address these critical operating areas,” he said.

Mr. Farley is also attempting to steer the iconic auto maker’s transition to electric vehicles, where China leads the way in both domestic market sales and battery development. A major part of that challenge is to wean American drivers off their gas-guzzling motors—including top-selling Ford F series trucks—onto electric models. 

In a bid to shore up its supply chain to include electric-vehicle batteries, Ford said last week that it reached a deal with Chinese battery manufacturer

Contemporary Amperex Technology Co.

to invest $3.5 billion in a battery plant in Michigan. The plant will employ thousands and will be wholly owned by Ford, but it will use knowledge and expertise provided by the world’s largest battery maker, the company said. 

That deal has put the spotlight on Ford’s China ties as a strategic rivalry over technology grows between Washington and Beijing. 

U.S. Sen.

Marco Rubio,

a Republican from Florida, said he was alarmed by the Ford-Contemporary Amperex Technology partnership. He called for a review of the deal and urged the Biden administration to ensure it didn’t receive tax credits or government funding.  

Write to Selina Cheng at [email protected]