Talks are ongoing between Chongqing Changan Automobile and partner Ford Motor Co. to build a mid-sized car in China that uses Ford technology but has a Changan badge, according to two sources.
Changan is one of China's top state auto groups; however, its weakness is in its own-brand sedans. To produce the Focus, Mondeo, Fiesta and other Ford models, Changan has entered a three-way tie-up with Ford and Mazda Motor Corp.
If this initiative is successful, it will be a step forward for this partnership and could lead the way for more, mutually beneficial deals.
One source told Reuters that when Ford CEO Alan Mulally went to China last March, he had a meeting with Changan Chairman Xu Liuping.
They discussed ways on how to bring their cooperation to the next level. A second source said that the partners are considering an option wherein Changan would make a mid-sized sedan based on a Ford platform in its own production base in Nanjing, near Shanghai.
This sedan will have the Changan name but in order to avoid competing against the comparable Ford model, it will be priced lower.
Both sources said that at this juncture, it is unsure which of Ford's car models will be built at Changan's Nanjing production base. Changan has yet to comment on this report while Ford's China spokesman, Craig Von Essen, described the reports as "market speculation."