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Ford Has Decided to Move Focus Production to China

BY: Alex Perrone
Man with a hat on driving a Ford car

Many auto industry insiders had predicted we would be seeing many major U.S. vehicles with a “Made in China” label. In 2017, Ford shifted production of its popular Focus vehicle, which might have been the biggest sign of what was to come.

China’s automotive industry had been on the rise for several years. That Detroit automaker, one of the big three, Ford, publicly announced that they had shifted all production of their Focus compact cars to their factories in China rather than Michigan or Mexico. While the move was noted as quite controversial in the US, the Chinese government saw this as a huge boon to their economy and relations with the US.

However, there seemed to be much arduous debate over U.S. and China trade relations and what this meant for both in the long term. The White House, under the Trump administration, had been vocally critical of trade deals with the Chinese since the election the previous year. Washington, DC, reps argued that China had high tariffs on imported vehicles. The issue was that auto parts had already posed problems.

As of 2017, China was noted in many publications, such as the Washington Post, New York Times, and USA Today, as the largest auto-making country in the world. The New York Times reported that China’s annual car production rivaled that of the United States and Japan combined.

Many Chinese industry leaders had pushed to build and develop factories along their major cities for the purposes of improving production and exportation.

Ford was not alone. Automakers, including Volkswagen and General Motors, also announced they had moved a lot of their research and development departments to China. The New York Times noted that this might have been due to the rise of electric car engineering.

Once this deal was finalized, Ford significantly increased China’s vehicle exports. Some economists predicted that automobile exports from China to the U.S. would increase.

How did this affect U.S. jobs and employment?

Detroit found the idea of using China as a manufacturing base interesting since China’s factory pay was actually higher than in Mexico at an estimated $1,250 a month, but the Chinese government was required to give workers major benefits. A few of these were housing funds for factory employees and overtime. At the same time, a big issue creating controversy in the U.S. was that the salary for Chinese automobile factory workers was significantly lower than in the United States.

U.S. auto industry insiders argued that moving factories to China would increase exports and kill off the demand for domestic manufacturing.

Another issue was that this could potentially take work away from U.S. auto factories and workers. The majority of these U.S. factories were found in the states of Indiana, southern Michigan, and Ohio. At that time, close to about 40% of the Focus’s parts were made in the Michigan factory, while Mexico factories built an estimated 26%.

The global auto industry had been changing, and this major move from Ford indicated that there was no sign of that stopping or slowing down. It was hard to tell how this trade deal between the United States and Chinese industries would pan out in the long run, but for then, the debate raged on.

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