Carmakers Geely from China and Ford from the USA have announced a major European manufacturing partnership, with new cars to begin assembly by 2028.
Ford’s Valencia factory in Spain will build vehicles for both Geely and Ford, including two electric SUVs bearing Geely badges and a Ford crossover jointly developed with Geely, plus a Ford SUV to join the Bronco family.
It will mean a joint venture, with Ford expected to own 66% of the new business, and Geely holding the remaining 34%.
The agreement is subject to regulatory approval. Once given the green light, the venture is hoped to begin in the first half of 2027, ahead of vehicle production starting in 2028.
“This JV with Ford in Europe reflects our commitment to open, collaborative product development as part of our growth strategy, deepening our local presence and commitment to customers in Europe”, said Alex Nan, vice president of Geely Auto Group.
He added: “We are dedicated to delivering vehicles that European customers will choose on merit: on industry leading features, on high-quality and on actively contributing to Europe’s green future. Put simply: we are building cars in Europe, for Europe, alongside a trusted partner.”
The partnership provides Geely with a way to expand inside the European Union, a key growth market for the Chinese vehicle manufacturer, while reducing its exposure to the additional tariffs imposed by the EU on some electric vehicles manufactured in China.
EV mandate and costs challenge
And Ford, whose market share has reduced significantly in the last two decades, will benefit from spreading the cost of designing, engineering and producing every new car it needs independently, due to the greater manufacturing scale and shared development resources.
The deal will “secure the plant’s future, provide long-term stability and create the potential for future high-tech manufacturing job growth, ” said Jim Baumbick, president, Ford of Europe.
“This isn’t just a partnership. This is our blueprint to win in an environment where intense competition, European electric vehicle mandates and industrial costs create challenges that no single company can solve alone.”
The Valencia factory, which currently produces the Ford Kuga, has potential annual capacity of around 500,000 vehicles but has recently been operating well below that level.
“For nearly 50 years, Valencia has built some of the most-loved cars in our history, and now this team will help build our future”, added Baumbick.
“That’s why we’re building a flexible, cost-effective industrial system with a capable partner in Geely Auto. Together we can fully utilise a best-in-class plant with a great workforce and match the industry’s new cost benchmark.
“This is all part of Ford’s vision to give European drivers rally-bred handling, true off-road capability and multi-energy technology, with a distinct Blue Oval DNA.”
Ford partners Volkswagen, Renault too
Ford’s links with Geely stretches back to 2010, when Ford sold off its Volvo Cars business to the Chinese automotive group.
Ford is also already in a partnership with Volkswagen for the development and production of both cars and vans. More recently it has joined forces with Renault, to deliver a new range of small electric cars.