Ford breaks ground on new plant in China

HANGZHOU, China (AP) — Ford Motor Co. is developing a lower-priced small car for the Chinese market but has no plans to start a separate, cheaper brand in China as rivals General Motors and Volkswagen have.

Ford executives discussed their plans during a three-day tour that ended Wednesday at the groundbreaking of a new assembly plant in the eastern city of Hangzhou. The $760-million plant, which is Ford’s first plant n the populous east coast of China, is expected to open in 2015.

“Hangzhou is really critical because of the market it serves, and it diversifies our operations,” CEO Alan Mulally said after shoveling some dirt in a ceremony with local officials. He said the city has good infrastructure and a trained workforce that will help Ford expand.

Ford won’t say what it plans to build there, but Ford China CEO Dave Shoch confirmed this week that a new small car similar to the Chevrolet Sail will be among the eight vehicles Ford is bringing to China by 2015.

Ford’s growth in China has been stymied by two things: It has just seven vehicles on sale here, compared with 30 for GM, and those it sells are relatively expensive. The Sail starts at around $10,000. Ford’s cheapest offering right now, the subcompact Ford Fiesta, starts at $13,316.

“I think Ford cars are safe. The material they use is good and thick, not like the Japanese cars. But the price is pretty expensive,” said Su Xiaoling, 31, a sales manager at a real estate company in Shanghai.