Ford exits Japan and Indonesia
Japanese competition too tough, and Indonesian business climate hinders short-term profitabilityNews agency Reuters has reported that Ford is closing down its import and distribution business in Indonesia and Japan.
According to the Reuters report, an email from Ford's Asia Pacific President Dave Schoch has revealed the company's plan to close down all operations in the two markets before the end of the year. The email, forwarded to employees cites "no reasonable path to profitability" in either market.
"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 the email.
Ford has outstayed GM, which closed down its Indonesian operations at a cost of 500 jobs. Both companies have reportedly faced intense competition from Japanese rivals in the south-east Asian market, but the Reuters report also observed that the Indonesian economy is experiencing a decline.
Boasting 35 staff and 44 dealerships there, Ford sold 6000 vehicles in Indonesia last year, for a 0.6 per cent share of the new-car market.
In Japan, Ford sold 5000 vehicles last year, amounting to a 1.5 per cent share of the imported new-car market. The company began selling cars in Japan from 1974 and the current dealer network numbers 52 dealerships and 292 staff.
While the numbers of Ford vehicles sold in Japan and Indonesia last year are small, relative to the total market size, it may improve Ford's capacity to supply the local market here with models currently in short supply – the Mustang being an obvious candidate.
The Reuters report indicated that Ford product development currently in progress in Japan will be shifted elsewhere, and Ford Australia's R&D facility in Campbellfield could be a beneficiary. But Ford Australia is admitting nothing on that front.
"It's just been announced [and] my understanding is we're working through the specifics, so we don't really have any detail as to what's going to happen – and when and where – with Japan," a Ford Australia spokesman told motoring.com.au this afternoon.
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