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Tuesday, February 20, 2024

Brazil's CAOA in talks to buy Ford factory: source

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SAO PAULO (Reuters) – Brazilian automaker CAOA, which produces vehicles with Korea’s Hyundai Motor Co and China’s Chery Automobile Co, is in talks to buy a Ford Motor Co plant in the country that is slated to close by 2019, according to a source with direct knowledge of the matter.

Ford announced earlier this month that it would shut down its São Bernardo do Campo plant, a sprawling complex in a suburb of São Paulo that employs some 3,000 people.

In 2018, Ford said it used only 12 percent of its installed capacity in the plant, which is its oldest in the country. Shutting the plant is part of Ford’s wider move to stop producing heavy commercial trucks in South America. It also produces the Fiesta small car at the plant.

Negotiations have not been finalized, the source said.

Earlier on Tuesday, São Paulo governor João Doria said there were three companies interested in buying Ford’s plant, although he declined to name them. Doria has pledged to help find a buyer for the plant.

São Paulo state government declined to comment on CAOA talks with Ford. A Ford representative denied that CAOA had approached the automaker directly about buying the factory.

CAOA, which started as a chain of dealerships, has expanded into manufacturing in recent years, most recently purchasing half of a factory originally developed by China’s Chery. As part of the move, cars produced in the factory are now co-branded CAOA Chery. 

CAOA is already Ford’s single largest distributor in the country.

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