3/27/2019

Ford Confirms 3 Plant Closures in Russia

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Ford Motor Co. confirms it is restructuring its vehicle-making venture with Russia’s Sollers PJSC by phasing out car production and building only commercial vans.

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Ford Motor Co. confirms it is restructuring its vehicle-making venture with Russia’s Sollers PJSC by phasing out car production and building only commercial vans.

The move gives Sollers, Russia’s second-largest carmaker after Lada, a 51% controlling stake in the 8-year-old venture.

Ford will take a one-time writedown of $450 million-$500 million. The charges will include about $200 million to cover payments to an unspecified “significant” number of workers whose jobs will be terminated by the cutbacks, according to the company.

Ford Sollers will stop making passenger vehicles at the end of June at factories in St. Petersburg and Tatarstan (Naberezhnye Chelny). The venture also will shut down an engine plant in Elabuga. The venture will continue to produce 2-tonne Ford Transit vans at the Tatarstan facility.

Last month, Russia’s car and light truck market ended nearly two years of year-on-year expansion, as sales fell 4% to 128,400 units. Ford’s deliveries plummeted 44% in January and 45% in February to only 4,200 units for the two-month period.

Ford sales in Russia last year rose 6% to 53,200 vehicles, according to the Moscow-based Assn. of European Businesses.