Ford Focus made in China, Mexico says it's hurt

According to foreign media reports, Ford announced last Tuesday that it would move part of the production of the Focus to the Chinese market instead of Mexico. Also in January this year, Ford announced the cancellation of its plan to invest $1.8 billion in its San Luis Potosi plant in Mexico.

Trump criticized the U.S. manufacturing industry during his campaign and threatened to impose huge tariffs on imported Mexican cars, which led Ford to cancel its investment plan in Potosi. Since then, the Tesla government's rhetoric has become more conciliatory, and the Mexican and U.S. governments are also hoping to revise the North American Free Trade Agreement, which is expected to officially begin in August and is expected to benefit both countries.

Losing the Focus production business is also a huge loss for Mexico. At the same time, the quality of Chinese exported cars is also rising, which also poses a great threat to Mexico. In the past decade, major global automakers have invested heavily in Chinese factories, hoping that the quality of the vehicles produced can reach the level of developed countries. Ford's transfer of Focus production from Mexico to China also proves that Ford's supply chain options in the two countries are very flexible.

The demand for small cars in the US market is gradually declining, and GM's Chevrolet Cruze compact version is facing the same problem. GM has also taken the same measure, that is, to move the production of Cruze to its Mexican factory, which has also increased the production task of the Mexican factory, but GM is also considering whether to produce the compact version of Cruze in Shenyang or Yantai factories in China. Pat Morrissey, a spokesman for GM, said: "Cruze is a global product, which is currently produced in factories around the world, including factories in the United States. GM's principle is to produce it where it is sold."

Studies have found that Mexico's manufacturing industry is very competitive, and its business leaders are convinced that Mexico's negotiations with the United States and Canada on the North American Free Trade Agreement will ultimately benefit local investment in North America.

Ford said that since it has chosen to produce the Focus in China and export it to the United States, it has already balanced the relationship between China's lower labor costs and high freight costs. Restructuring the Chinese factory can save about $500 million compared to restructuring the Mexican factory. Once Trump plans to impose a 35% tariff on imported cars from Mexico, the trade relationship between the United States and Mexico is at great risk.

Trump has threatened to impose a 45% tariff on Chinese goods, but his business representative Robert Lighthizer said Ford's move to produce the Focus in China was very disturbing.

In addition, Trump's series of "threatening" remarks have also severely hurt the Mexican peso and caused the prices of Mexican goods to continue to fall, while the uncertainty about the future of the North American Free Trade Agreement has also caused the peso exchange rate to hit a new low in January.

Also in January this year, Boston Consulting Group released an assessment of the production competitiveness of China and Mexico, which showed that Mexico's competitiveness was 11% higher than that of China. It is precisely because of this advantage that major global companies have increased their investment in Mexico's automotive industry, and Mexico's production has reached a record high.

According to a research report released by JD Power in 2016, the quality of automobiles produced in China has substantially improved. Jacob George, general manager of JD Power Asia Pacific business, said that China's automobile production will almost reach international standards by 2018 or 2019, but from the outside world's perspective, China's automobile production seems to be 4 to 6 years behind.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.