Despite the heavy government incentives given to Chinese automotive manufacturers and their rock-bottom prices, it seems some traditional automakers can still find a way to break through.
Ford beat its American competitors in the Chinese market
Ford’s CEO, Jim Farley, reported that the American manufacturer earned around $600 million last year. Although Ford does not usually report its asset earnings by region, Farley saw the opportunity to tout its success in such a famously challenging country.
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“I’m happy to say that Ford makes money in China, and I’m very proud of that because not many [automakers] can say that,” Farley said following a vehicle reveal for the Detroit Auto Show.
Ford has made a particular effort to be a part of the Chinese economy with the Lincoln Nautilus, a mid-size luxury crossover SUV, whose second generation is produced by Changan Ford in China while Ford is retooling their Oakville Assembly plant to produce electric vehicles.
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Others haven’t done so well
Like Farley said, other manufacturers have not been so lucky. Hyundai partnered with Chinese state-owned automobile manufacturer BAIC to create a $1.1 billion joint venture dubbed Beijing Hyundai Motor Co. The Korean automaker hopes to alleviate its tanking sales in China, which amounted to losses of 2.6 billion yuan ($358 million) for the first nine months of 2024, according to Beijing Hyundai.
Toyota reported a 9% drop in Chinese sales in 2024. The same year, GM announced a $5 billion hit to its profits as part of a restructuring effort to address its falling operations in China. Even Honda saw a 46% decline in sales.
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Final thoughts
Ford’s victory may be a sign that succeeding in the Chinese automotive market is not as impossible as previously thought.
While Farley didn’t explicitly state how the company managed to turn a profit in China despite many other companies’ failure to do so, its partnerships might be a clue. Ford currently has two joint ventures in China: one with Changan Automobile, called Changan Ford (CAF for short), and one with Jiangling Motors, called JMC.
Ford
As CAF, Ford builds a few China-exclusive vehicles, like the Kuga, which is a version of our North American Escape, and the Mondeo, their version of our Fusion. With JMC, it builds the Ford Transit vans, a truck-based SUV called the Everest, and a line of light trucks.
If such partnerships are key, we may soon see Hyundai’s Beijing Hyundai Motor Co. report similar numbers.
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