| Mazda Increases Investment in China
A new partnership structure has created Changan Ford Mazda Automobile
Mazda Motor Corporation (Mazda) announced today that the Chinese government has approved Mazda's investment in Changan Ford Automobile Co., Ltd. (Changan Ford), the joint venture between Changan and Ford. The restructured company has been renamed as Changan Ford Mazda Automobile Co., Ltd. (CFMA). With the completion of the investment fund transfer, this equity restructuring marks another major step forward in the three-party partnership in China, following the three parties' joint announcement on the commencement of the production of Mazda3 in Changan Ford's Chongqing Plant on February 27, 2006.
Changan, Ford and Mazda hold 50 percent, 35 percent and 15 percent shares in CFMA, respectively. The 15 percent shares owned by Mazda in CFMA were transferred by Ford from the company's 50 percent shareholding originally held in Changan Ford.
"We are pleased that Mazda's investment in Changan Ford was completed smoothly. With this movement, the fundamentals of cooperation among Mazda, Ford and Changan will be further strengthened, and the progress of the three-party joint projects in Chongqing and Nanjing will surely be accelerated. Moreover, this will also expand the possibility of further cooperation among the partners," said Mr. Kiyoshi Ozaki, Mazda's Director and Senior Managing Executive Officer in charge of Mazda's China business strategy. "We believe that the three-party joint venture has built a sound foundation for Mazda to achieve our mid-term goal of producing and selling 300,000 units in the Chinese market by 2010. This would not be possible without the great support of the Chinese government and each partner in China, which I deeply appreciate."
"The equity restructuring of Changan Ford has lifted the partnership among Ford, Mazda and Changan in China to a closer and more substantial stage," said Mei Wei Cheng, Chairman & CEO of Ford Motor (China) Ltd.. "I have no doubt that the three-party joint venture CFMA will fully combine the advantageous resources of three parties so as to provide more new and exciting products to Chinese customers. I also strongly believe the company will grow fast to become one of the top tier auto manufacturers in China."
"The restructuring of Changan Ford with Mazda's participation is the result of joint efforts and great partnership of Changan, Ford and Mazda. This shows the three parties have entered into a new stage of cooperation in terms of brand, technology, marketing, and resources sharing, " said Yin Jiaxu, Deputy General Manager of China South Industries Group Corp., Chairman of Changan Automotive Group as well as Changan Ford. "Changan will further its cooperation with Ford and Mazda in order to deliver high quality products to meet customer needs. Meanwhile, Changan will work closely with its partners to build up a brand new model of operation to maximize each party's benefits. "
The long-term, strategic partnership among Mazda, Ford and Changan in China has been developing fast over the past two years. The three parties are jointly building a brand new vehicle assembly plant in Nanjing, the second manufacturing base of CFMA, which is able to produce both Mazda and Ford brand cars. The operation of the Nanjing assembly plant is expected in 2007, with an initial annual capacity of 160,000 units. The three parties are also jointly expanding the capacity of the Chongqing plant of CFMA, which now claims an annual capacity of 150,000 units, and will be further expanded to 200,000 units by May this year. Part of the expanded capacity in Chongqing is being used for the production of Mazda3. Adjacent to the Nanjing assembly plant is the three-party joint venture Changan Ford Mazda Engine Co., Ltd., which is being constructed and will be operational in 2007. The engine company is also able to produce world-class engine products of both Ford and Mazda brands, which are expected to supply to the three parties' vehicle assembly operations in China.
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