DETROIT: Ford Motor Company plans to close its three plants in Brazil this year and take pretax charges of about $4.1 billion as the Covid-19 pandemic amplified the company’s under use of its manufacturing capacity.
Production will cease immediately at Ford’s plants in Camaçari and Taubaté, with some parts production continuing for a few months to support inventories for aftermarket sales. The Troller plant in Belo Horizonte, Brazil, will continue to operate until the fourth quarter.
Ford officials said the action was part of the $11bn global restructuring previously forecast by the US carmaker, of which it had accounted for $4.2bn through the third quarter of 2020.
The plant closures affect about 5,000 employees, mostly in Brazil, Ford spokesman T R Reid said.
Industry vehicle sales fell 26 per cent in Brazil last year and are not expected to rebound to 2019 levels until 2023 with an emphasis on less profitable fleet sales, Ford said.
Ford officials said the plant closures are part of the company’s strategy to achieve 8pc global operating margins. Ford, which has operated in Brazil for more than a century, has begun discussions with its unions and others about the layoffs.