Report: Cost-conscious Ford to Slash Russian Operations

The Blue Oval brand stands to seriously pare back its Russian presence, a new report claims, with two of the automaker’s three assembly plants rumored to close. Ford entered into a joint venture in the country in 2011, partnering with Russia’s Sollers. The two recently reached a new agreement, Sollers claims, but details remain scarce.

One person with knowledge of the pact claims Ford will cut its passenger car operations, leaving only its commercial vehicle business. More market share for the resurgent Lada, it seems.

Rumors of looming cuts have swirled since the beginning of the year. Like its European and South American businesses, Ford’s Russia venture was placed under the microscope in the company’s wide-ranging search for savings.

Speaking to Bloomberg, the source said Ford’s global restructuring plan will likely leave the automaker with just one Russian plant. The plants fingered for closure, in St. Petersburg and Tatarstan, assemble Focus, Mondeo, Fiesta and Ecosport models, while a third plant cranks out Ford commercial vehicles and a brace of utility vehicles — the Kuga and Explorer. An official announcement could come Wednesday.

Last month, the Russian industry journal AutoReview (via Wards Auto) reported that Ford’s future production efforts would consist solely of the Transit van. Existing passenger car models would either be imported or discontinued.

Russia’s new car market is on the ascent following a deep recession that cratered demand. Ford, however, hasn’t been a recipient of much of that new consumer spending. Sales never fully rebounded after volume losses of 38.2 percent in 2014 and 41.5 percent in 2015.

In 2018, Ford sales rose 5.7 percent in a market that grew by 12.8 percent, losing market share to better-selling import brands like Nissan, Volkswagen, Toyota, Hyundai, and Kia. The Blue Oval’s take of the Russian new car market was just 3 percent last year, compared to Lada’s 20 percent. The patriotic domestic brand’s sales rose 15.6 percent in 2018 on the success of the Vesta vehicle family, which recently celebrated the arrival of a new crossover.

[Image: Ford]