Ford Motor Co. has been selected as the buyer of a majority stake in a Craiova car manufacturing plant formerly owned by South Korea's Daewoo Motor, Romania's Authority of State Assets Recovery, AVAS said Friday.
No details about the value of the deal were announced Friday. “Although it is too early to discuss specifics of our proposal, we believe it offers the best combination of financial, technological and environmental commitments,” Ford of Europe President and CEO John Fleming said in a prepared statement. Ford’s European division produced 1.86 million units at seven assembly plants in 2006 and sought the added manufacturing space in Craiova to meet its growth plans, the company said. “If we are successful in our bid, we would expect to expand and improve the Craiova manufacturing operations, increase employment and attract additional suppliers to the area,” Fleming said.
The factory employs about 4,000 workers and can produce up to 200,000 cars and 300,000 engines per year. Last August, the Romanian state bought back 51% of the company from Daewoo's creditors for €44 million ($60 million). The Romanian state now owns 78% of the plant, while local investment fund SIF5 Oltenia holds 22%. Many auto parts makers have set up in Romania recently as the industry takes advantage of cheap labor and favorable tax rates in Romania. Ford of Europe's director for business strategy Lyle Watters said the US-based company has been interested in the Craiova plant for more than two years.
Other competitors for the former Daewoo plant were General Motors Corp. and JC Russian Machines, part of the Russian Ganz Group controlled by billionaire Oleg Deripaska. (birn.eu.com)