The rise of China’s automotive industry – and the subsequent attempts to thwart off the threat it poses via tariffs – has resulted in a handful of the nation’s car brands exploring new production bases for their vehicles.
In February, Reuters reported Ford was discussing allowing Geely to use its spare production capacity at its car factory in Valencia in Spain, allowing Geely to build vehicles in Europe, effectively side-stepping tariffs on Chinese EVs introduced by the region.
Currently Geely’s EVs are hit with an 18.8 per cent tariff on top of the base 10 per cent tariff.
Now, three months down the track, Automotive News – via Spanish publication La Tribuna de Automocion – reports Ford may sell one of its assembly halls at the Valencia plant to Geely, a point of difference compared to the original reports.
Geely will reportedly buy the ‘Body 3’ assembly hall at Valencia, the former home of production for the fourth-generation Mondeo, among other vehicles.
The report claims Geely is already in the process of contacting suppliers in the Valencia area, with the likely vehicle expected to be built in Europe being based on its GEA platform, supporting plug-in hybrid and electric powertrains.
At present, only the Ford Kuga is built at the factory, though it’s been widely reported it’ll be joined in 2027 by a European market version of the Bronco SUV, with the two vehicles understood to be mechanically related.
With the plant reportedly having a planned annual capacity of 400,000 vehicles but currently producing about 100,000, adding more lines would help it to become a more cost-effective exercise.
It’s worth noting Ford and Geely already have a mutual partnership with Renault. Geely has assisted Renault with certain models sold outside Europe, while Ford signed an agreement to use the French brand’s EV platforms on the continent in the near future.
Ford’s potential move to partner with Geely is unsurprising, given CEO Jim Farley has previously sung the praises of China’s car industry, while also warning about the threat it poses.
“They have enough capacity in China with existing factories to serve the entire North American market, put us all out of business,” Farley told CBS Sunday Morning.
“Japan never had that. So, this is a completely different level of risk for our industry.”
Farley also recently sounded the alarm bell while speaking on US program Fox and Friends about the possibility of Chinese cars being imported to the US last month.
“The Chinese have huge direct support for their auto companies – there are over 100 of them, and the places they have imported [to] – their local market [China] is 29 million, [but] their capacity in the country for making cars is over 50 million,” Farley said.
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