Romania Halves Aid to Ford after Production Plans Falter

March 14, 2012
Government says action taken after automaker reduces manufacturing commitment.

The Romanian government announced Tuesday it would halve its aid to U.S. automaker Ford after plans to manufacture locally 250,000 vehicles per year failed.

Romania had pledged in 2009 to grant Ford 143 million euros (US$187 million) in state aid.

The car maker promised in exchange to manufacture 250,000 vehicles per year until 2011 and 300,000 per year onward in its Romanian plant of Craiova.

But in 2010 it admitted it was running behind with its plans.

"Ford now plans to manufacture 810,000 vehicles and 1.5 million engines between January 1st, 2013 and December 31st, 2017," the government said.

"Following the car maker's revised commitments ... the Romanian state aid will amount to 75 million euros," it added.

"Ford's new figures point to a significantly lower manufacturing capacity," the government's spokesman Dan Suciu told AFP.

But he stressed that the automaker still planned to invest a total of $1.1 billion in Romania through the end of 2012.

The car maker bought the Craiova plant, a former Daewoo facility, in 2008 for $74 million.

But its plans to turn it into a globally competitive manufacturing facility by injecting $850 million were hurt by the economic crisis.

Ford started production in 2009 and a year later barely manufactured 9,550 units.

In 2012, the company plans to produce 60,000 B-Max vehicles.

Copyright Agence France-Presse, 2012

See Also:

Ford U.S. Sales up 14%; Focus Continues to Surge

Popular Sponsored Recommendations

Four Keys To Operational Excellence

Sept. 20, 2023
As manufacturers face supply chain disruption and shrinking margins, increasing operations performance is critical. Our smart manufacturing guidebook can help you achieve the ...

Modern Edge Computing Accelerates Smart Manufacturing Initiatives for Discrete Manufacturers

Oct. 22, 2023
Discover how Edge Computing platforms are a requisite for discrete manufacturers to solve production challenges, accelerate digitalization, and establish a reliable infrastructure...

Process Mining For Dummies

Nov. 19, 2023
Here it is. Everything you need to know about process mining in a single book, written in the easy-to-understand, hard-to-forget style that ‘For Dummies’ manages so effortlessly...

How Manufacturers Can Optimize Operations with Weather Intelligence

Nov. 2, 2023
The bad news? Severe weather has emerged as one of the biggest threats to continuity and safety in manufacturing. The good news? The intelligence solutions that build weather ...

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!