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Facing weak market share, Ford to exit Japan, Indonesia this year
January 25, 2016 7:30 AM
By Jake Spring and Naomi Tajitsu
BEIJING/TOKYO (Reuters) - Ford Motor Co (F.N) said on Monday it will close all operations in Japan and Indonesia this year as it sees "no reasonable path to profitability" in the two countries where it has struggled to gain market share.
Ford will exit all areas of business, including shuttering dealerships and stopping sales and imports of Ford and Lincoln vehicles, according to an email from Asia Pacific President Dave Schoch to all employees in the region viewed by Reuters. Product development carried out in Japan will be shifted elsewhere.
"Unfortunately, this also means that our team members based in Japan and Indonesia will no longer work for Ford Japan or Ford Indonesia following the closures," Schoch wrote in an email regarding the decision that was sent to employees on Monday.
Ford, one of Detroit's "big three" automakers, follows in the footsteps of General Motors Co (GM.N), which last year decided to stop making GM-branded cars in Indonesia - with the loss of 500 jobs - amid intense competition from Japanese rivals.
Ford began operating in Japan in 1974 and has 52 dealerships in the country, employing 292 people. Last year, it sold around 5,000 vehicles in Japan and held a share of around 1.5 percent of the imported new car market.
In Indonesia, where it entered the market in 2002, Ford has a staff of 35 and sells through 44 franchised dealerships. Last year, it sold around 6,000 vehicles, taking a 0.6 percent share of the total new car market in a country struggling from economic slowdown.
"In Indonesia, without local manufacturing ... there's just really no way that automakers can compete in that market, and we do not have local manufacturing," said a Ford spokeswoman based in Shanghai, confirming the content of the email.
The company has also had a tough time selling its Fiestas, Mustangs and Explorers in the Japanese market, which is dominated by Toyota Motor Corp , Honda Motor Co , Nissan Motor Co and other domestic brands.
On top of that, vehicle sales have been falling in Japan as the population ages and demand for cars by young people decreases.
(This version of the story deletes final paragraph after Ford spokeswoman says it no longer holds shares in Mazda, correcting earlier comment that it would maintain its minority stake after exiting Japan.)
Ford shutting down Japan and Indonesia - Business Insider
Matthew DeBord and Reuters
Jan. 25, 2016, 9:31 AM
BEIJING - Automaker Ford Motor Co said on Monday it will close all operations in Japan and Indonesia this year as it sees "no reasonable path to profitability" in the two countries.
Ford will exit all areas of business, including shuttering dealerships and stopping sales and imports of Ford and Lincoln vehicles, according to an email from Asia Pacific President Dave Schoch to all employees in the region.
Product development carried out in Japan will be shifted elsewhere.
"Unfortunately, this also means that our team members based in Japan and Indonesia will no longer work for Ford Japan or Ford Indonesia following the closures," Schoch wrote. A Ford spokeswoman earlier confirmed that an email regarding the decision was sent to employees on Monday.
The automaker employs 292 workers in Japan, while it has a staff of 35 in Indonesia and 44 dealerships there, according to Shanghai-based Ford spokeswoman Karen Hampton.
Ford follows in the footsteps of General Motors , which last year decided to stop making GM-branded cars in Indonesia - with the loss of 500 jobs - amid intense competition from Japanese rivals.
The story in these parts of Asia contrasts vividly with Ford and GM's operations and sales in China, where GM has been enjoying a surging market for the better part of a decade and Ford has recently begun to tap into the Chinese boom.
As China's growth slows, automakers are looking to refocus their Asian businesses. Japan in particular has never been a strong market for US domestic car makers, unlike their home market, where Japanese companies are firmly established and have over 40 years built up impressive markert share and loyalty among US consumers.
(Reported for Reuters by Jake Spring. Additional reporting by Naomi Tajitsu in TOKYO; Editing by Clarence Fernandez and Kenneth Maxwell)
@Nihonjin1051 @Indos
January 25, 2016 7:30 AM
By Jake Spring and Naomi Tajitsu
BEIJING/TOKYO (Reuters) - Ford Motor Co (F.N) said on Monday it will close all operations in Japan and Indonesia this year as it sees "no reasonable path to profitability" in the two countries where it has struggled to gain market share.
Ford will exit all areas of business, including shuttering dealerships and stopping sales and imports of Ford and Lincoln vehicles, according to an email from Asia Pacific President Dave Schoch to all employees in the region viewed by Reuters. Product development carried out in Japan will be shifted elsewhere.
"Unfortunately, this also means that our team members based in Japan and Indonesia will no longer work for Ford Japan or Ford Indonesia following the closures," Schoch wrote in an email regarding the decision that was sent to employees on Monday.
Ford, one of Detroit's "big three" automakers, follows in the footsteps of General Motors Co (GM.N), which last year decided to stop making GM-branded cars in Indonesia - with the loss of 500 jobs - amid intense competition from Japanese rivals.
Ford began operating in Japan in 1974 and has 52 dealerships in the country, employing 292 people. Last year, it sold around 5,000 vehicles in Japan and held a share of around 1.5 percent of the imported new car market.
In Indonesia, where it entered the market in 2002, Ford has a staff of 35 and sells through 44 franchised dealerships. Last year, it sold around 6,000 vehicles, taking a 0.6 percent share of the total new car market in a country struggling from economic slowdown.
"In Indonesia, without local manufacturing ... there's just really no way that automakers can compete in that market, and we do not have local manufacturing," said a Ford spokeswoman based in Shanghai, confirming the content of the email.
The company has also had a tough time selling its Fiestas, Mustangs and Explorers in the Japanese market, which is dominated by Toyota Motor Corp , Honda Motor Co , Nissan Motor Co and other domestic brands.
On top of that, vehicle sales have been falling in Japan as the population ages and demand for cars by young people decreases.
(This version of the story deletes final paragraph after Ford spokeswoman says it no longer holds shares in Mazda, correcting earlier comment that it would maintain its minority stake after exiting Japan.)
Ford shutting down Japan and Indonesia - Business Insider
Matthew DeBord and Reuters
Jan. 25, 2016, 9:31 AM
BEIJING - Automaker Ford Motor Co said on Monday it will close all operations in Japan and Indonesia this year as it sees "no reasonable path to profitability" in the two countries.
Ford will exit all areas of business, including shuttering dealerships and stopping sales and imports of Ford and Lincoln vehicles, according to an email from Asia Pacific President Dave Schoch to all employees in the region.
Product development carried out in Japan will be shifted elsewhere.
"Unfortunately, this also means that our team members based in Japan and Indonesia will no longer work for Ford Japan or Ford Indonesia following the closures," Schoch wrote. A Ford spokeswoman earlier confirmed that an email regarding the decision was sent to employees on Monday.
The automaker employs 292 workers in Japan, while it has a staff of 35 in Indonesia and 44 dealerships there, according to Shanghai-based Ford spokeswoman Karen Hampton.
Ford follows in the footsteps of General Motors , which last year decided to stop making GM-branded cars in Indonesia - with the loss of 500 jobs - amid intense competition from Japanese rivals.
The story in these parts of Asia contrasts vividly with Ford and GM's operations and sales in China, where GM has been enjoying a surging market for the better part of a decade and Ford has recently begun to tap into the Chinese boom.
As China's growth slows, automakers are looking to refocus their Asian businesses. Japan in particular has never been a strong market for US domestic car makers, unlike their home market, where Japanese companies are firmly established and have over 40 years built up impressive markert share and loyalty among US consumers.
(Reported for Reuters by Jake Spring. Additional reporting by Naomi Tajitsu in TOKYO; Editing by Clarence Fernandez and Kenneth Maxwell)
@Nihonjin1051 @Indos
