Ford Will Invest $156.5 Million in Argentina Business

Argentina heats up...

By Brendan Moore

08.13.2007

Ford has issued a press release stating that they are going to invest $156.5 million (USD) in their Argentinian subsidiary in order to develop a new car and pickup truck model specifically for the Latin American market.

No other details regarding the vehicles were revealed. Ford did say that the new models would be produced at the Pacheco plant which is right outside of Buenos Aires. Approximately 70% of Ford’s production at the plant is sold outside of Argentina, but in Latin America. Ford currently produces the Focus sedan and the popular Ranger pickup in Argentina.

2007 Troller Pantanal

There is some chatter that Ford may use the Troller Pantanal pickup as the basis for the new pickup. Ford acquired Troller of Brazil in early 2007; Troller produces only two models; a small, tough 4WD named the T4 which is based on the original Willys Jeep, and the aforementioned pickup truck called the Pantanal. Despite the chatter, this seems somewhat divorced from reality as the Pantanal, although tough as nails, is an old design, and could not be adapted easily to current industry standards.

Things looked very bleak for Ford fairly recently in Argentina, as they did for all the car companies in the country, particularly during the economic freefall that occurred in 2001 and lasted until 2003. The auto manufacturing sector in Argentina, however, is now experiencing a rebirth of sorts, with 432,101 vehicles produced in 2006. Argentina is currently the No. 3 auto-producing county in Latin America. Some industry-watchers are predicting that 2007 could see an all-time production record of over 500,000 vehicles. This healthy market climate has prompted Ford to make the new-model investment in Argentina. The Argentine economy as a whole has grown an average 8% annually since 2003.

Another important factor currently is the weak Argentine peso, which makes the cars and trucks produced in Argentina look like quite the bargains in the rest of Latin America.

Ford is not alone in sensing opportunity in Argentina – Fiat, General Motors, Honda, VW, and Chery are all increasing their investment in Argentina’s auto production base.

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