Detroit's Ford phases out Brazil manufacturing operation, will take $4.1bn in charges

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Detroit's Ford phases out Brazil manufacturing operation, will take $4.1bn in charges

On Monday, Ford Motor Co., the 117-year old American multinational carmaker which had long been reaping the benefits of its stance as the United States’ second-largest passenger carmaker before an unprecedented uprising in Tesla Inc’s market cap last year, had issued a statement saying that the Dearborn, Michigan-based third-largest carmaker in the US, would close out three of its major production facilities in Brazil and would likely to take a stark upsum of $4.1 billion in pre-tax charges, pointing towards a perilous blow for the US carmaker as the company looks to a sweeping overhaul of its global business landscape.

On top of that, latest move from Ford Motor Co. to cease manufacturing operations in Brazil, the largest LATAM economy, came forth as the American carmaker had been witnessing a steep drop in demands, largely due to pandemic-led restrictions.

In tandem, Ford officials were quoted saying followed by the announcement that the latest move from the automotive industry behemoth had been a part of its $11-billion global restructuring plan stated earlier last year, while the NYSE-listed shares of Ford Motor Co climbed as much as 3.33 per cent to $9.30 per share after the statement.

Production will cease immediately at Ford’s major manufacturing hubs in Brazil

Apart from that, Ford Motor Co. had added that the American multinational automaker had already winded down operations at its Brazilian plants in Camacari and Taubate, while Ford’s Troller plant in Belo Horizonte would remain operational until the fourth quarter of 2021 in a bid to support auto part inventories for aftermarket sales.

Besides, followed by the announcement, a spokesperson for Ford Motor Co., T. R. Reid said in a conference call with the reporters that the plants’ closures in Brazil would affect around 5,000 jobs in the country.

Ford was also quoted saying at its statement released earlier in the day that the sales of its vehicles took a tattering header of 26 per cent in Brazil last year and the American automaker was not expecting a rebound in sales at least until 2023.