Ford Considers European Joint Venture With Mazda

Ford Motor Co. is studying a joint venture to produce vehicles in Europe with its Japanese partner Mazda Motor Corp., a top Ford official said Wednesday.

Speaking to reporters at a University of Michigan automotive seminar, Ford Executive Vice President Philip Benton also denied trade publication reports that the auto maker has killed its PN38 truck program, an ambitious plan of new trucks and mini-vans for the 1990s.

In the first direct public comments by a Ford executive on the program, Benton said it has not been canceled but has been modified.

No Construction Dates

Ford owns about 25% of Mazda, in what is considered the most successful partnership between a U.S. and Japanese auto maker. Mazda builds the Ford Probe at its Flat Rock, Mich., plant, and its 323 subcompact provides the base for the Mercury Tracer, built by Ford in Mexico.

“We’re looking at how we can best get together in Europe,” Benton said of the potential venture.

Mazda officials said earlier this year that they were holding talks with Ford on a European venture, but Ford did not confirm the statement.

Benton said any venture would require an expansion of Ford’s already tight production capacity situation in Europe. “We would have to find means to expand capacity,” he said.

Although Ford has not built a U.S. plant since its Kentucky truck facility opened in 1969, Benton also said Ford has not ruled out the possibility of building new production centers in the United States during the 1990s. He said the company has decided that new plants are inevitable.

“It’s only a question of time,” Benton said.

However, he would not say exactly when these plants will be built. “When does tomorrow come? I don’t have the foggiest idea.”

The first vehicles in Ford’s PN38 program were expected to be introduced in the early 1990s. The program involves a new series of full-sized trucks, mini-vans and sport utility vehicles and its importance had been compared by some analysts to the auto maker’s Taurus and Sable car development program.

Some reports had said the recent softening in U.S. auto sales was responsible for the program being killed. Ford’s U.S. auto sales are down about 2% this year.

“We have not canceled PN38. We have changed its complexion,” Benton said.

He said the project would have involved developing new engines and transmissions, and Ford is already strapped for capacity in those components. The revised plan, Benton said, will allow Ford to use existing engines and transmissions.