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Ford plans to cancel $1.6B Mexico plant

Ford plans to cancel $1.6B Mexico plant

Ford has abandoned plans to spend $1.6 billion building a new factory in Mexico, the company said Tuesday, announcing that it will invest $700 million to expand a manufacturing facility in MI.

A total of $700 million will be spent to expand and upgrade Ford's Flat Rock Assembly Plant in MI, with 700 new jobs added.

Announced in early 2016, Ford said it would move production of its Ford Focus from MI to the would-be plant in San Luis Potosi, Mexico.

A Ford Fiesta is built at one of Ford's existing plants in Mexico.

Ford said the change of plans would safeguard 3,5000 U.S.jobs. All Chevrolet Cruze sedans sold in the US are built in GM's assembly plant in Lordstown, Ohio.

Ford is dedicating $4.5B toward electrified vehicles by 2020, and based on today's announcement, it seems no vehicle in the Blue Oval's lineup is being overlooked for electrification.




Last year, billionaire Elon Musk showed off an array of robots already working in his Tesla Gigafactory, the $5 billion manufacturing facility where Musk plans to build electric cars and lithium-ion batteries.

Shifting Focus production to Hermasillo, Mexico, from Wayne, Mich., will enable that US plant to make "two new iconic products" there that will safeguard 3,500 jobs, Ford said.

Flat Rock assembly first opened to build midsize, front-wheel-drive Fords and Mazdas, and now builds the rear-wheel-drive Mustang and front-wheel-drive Lincoln Continental. Thirteen new hybrid or fully electric Ford models will be reaching the market within the next five years, including hybrid versions of the F-150 pickup and Mustang in the USA; a plug-in hybrid Transit Custom van in Europe; and a fully electric SUV, which is expected to have a range of at least 300 miles, in markets all across the world.

Trump had earlier said via Twitter, "Make in United States of America or pay big border tax!", which drew the attention of the public and several organizations. "We did it for our business", Ford CEO Mark Fields told CNN on Tuesday.

Industry group Center for Automotive Research estimated in an August 2016 report that vehicles produced in Mexico are comprised of up of up to 40% US -made content, with USA exports of parts and components to Mexico more than doubling between 2005 and 2014 to a level of $18.4 billion.

In fact, only a tiny fraction (2,400 out of 190,000) of the GM model he singled out, the Cruze, are made in Mexico. GM responded by saying only a "small number" of Cruze hatchbacks are shipped from Mexico to the U.S.

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