DETROIT (Reuters) – Ford Motor Co. said Monday it will close its three plants in Brazil this year and charge upwards of about $ 4.1 billion as the COVID-19 pandemic amplifies the company under the use of the its manufacturing capacity.
Production will cease immediately at Ford’s plants in Camaçari and Taubaté, and production of some parts will continue for a few months to support subsequent sales inventories. The Troller plant in Horizonte, Brazil, will continue to operate until the fourth quarter.
Ford officials said the action was part of the $ 11 billion global restructuring previously planned by the U.S. automaker, of which it had accounted for $ 4.2 billion by the third quarter of 2020.
Plant closures affect about 5,000 employees, mostly in Brazil, Ford spokesman TR Reid said in a conference call with reporters. Industry vehicle sales fell 26% in Brazil last year and are not expected to rebound to 2019 levels by 2023 with a focus on less profitable fleet sales, Ford said.
“We know these are very difficult actions, but necessary, to create a healthy, sustainable business,” Jim Farley, Ford’s chief executive, said in a statement. “We are moving towards a small and active business model by stopping producing in Brazil.”
With the departure of manufacturing in Brazil, Ford retains one plant in Argentina and another in Uruguay.
Report by Ben Klayman in Detroit; Edited by Franklin Paul and Matthew Lewis