Ford to halt production in Laguna plant

MANILA, Philippines – Ford Philippines, a unit of US-based automaker Ford Motor Co., is halting its assembly operations in its plant in Sta. Rosa, Laguna by the end of this year. The shutdown is expected to affect about 250 employees.

Peter Fleet, Ford ASEAN president, told reporters yesterday that the decision was being made in line with a restructuring of the firm’s regional manufacturing operations as well as the weak local demand and small supply base for vehicles.

“Today’s automotive industry in the Philippines in terms of scale and today’s automotive supplier industry in the Philippines in terms of scale, both of those do not support a business decision for us to assemble vehicles in the Philippines,” he said.

The decision, he said, was purely a business decision and is in no way a reflection of its concerns with the government.

The government, Fleet also said, has been very supportive of the firm.

He said the firm has been exploring for the past 18 months what vehicles could be assembled in the Sta. Rosa plant but could not find a strong enough business case to continue the manufacturing of vehicles in the country as they cannot source components competitively.

He also admitted that the firm does not see the Sta. Rosa plant as having the potential to manufacture vehicles in the same scale as its other plants which can produce 300,000 units.

Ford’s plants in China, India and Thailand, he said, on the other hand, are all seen to have the potential to achieve that scale.

The Sta. Rosa plant, he said, would stop its operations by the end of this year, with the end of the manufacture of Ford Escape vehicles.

He said that about 250 employees are expected to be affected but that the firm is in talks with their staff to explore opportunities that are available for them in the company’s operations overseas.

Ford Group Philippines president Randy Krieger said in the same event that the firm has a fair separation package and a comprehensive program in place to assist affected employees on career transitions.

“Filipino workers are good in understanding the process and we can possibly, send them overseas,” he said.

Fleet said that while Ford is closing down its assembly plant in Sta. Rosa, it is still committed to the Philippines as it plans to double its national dealer network from 20 to 40 by 2015.

The plant closure, he assured, is not going to affect the pricing and availability of Ford products in the country.

Krieger said Ford would launch three new vehicles in the country in 45 days which are the new Ford Ranger, Ford Focus and Ford Mustang.

“We are absolutely committed to an aggressive growth strategy through our national sales company, Ford Group Philippines, which will continue to support our marketing, sales and service operations moving forward,” he said.

The planned shut down of the Sta. Rosa plant by the end of this year would be the second time the automaker would pulled out its investment to the country.

Ford left the country in 1985 citing a weak peso.

Ford’s Sta. Rosa plant started its operations in 1999.

The plant which has a production capacity of 36,000 units, employed approximately 360 people and represents a total investment of more than $270 million.

The plant assembles Ford Escape vehicles sold in the domestic market as well as in other ASEAN markets like Thailand, Indonesia and Malaysia. –Louella D. Desiderio (The Philippine Star)