DETROIT (Reuters) – Ford Motor Co said Monday it will close its three factories in Brazil this year and will charge pre-tax costs of approximately $ 4.1 billion as the COVID-19 pandemic the company is using its production capacity.
Production at Ford’s Camaçari and Taubaté plants will cease immediately, with production of some parts continuing for several months to support stocks for aftermarket sales. The Troller plant in Horizonte, Brazil, will remain in operation until the fourth quarter.
Ford officials said the move was part of the $ 11 billion global restructuring previously forecast by the U.S. automaker, which accounted for $ 4.2 billion through the third quarter of 2020.
The factory closures affect about 5,000 employees, mostly in Brazil, Ford spokesman TR Reid said during a conference call with reporters. Industrial vehicle sales fell 26% in Brazil last year and are not expected to recover to 2019 levels until 2023, with an emphasis on less profitable fleet sales, Ford said.
“We know that these are very difficult but necessary steps to create a healthy and sustainable company,” said Jim Farley, Ford’s Chief Executive. “We are moving to a lean, asset-light business model by discontinuing production in Brazil.”
Leaving production in Brazil, Ford will keep one plant in Argentina and another in Uruguay.
Reporting by Ben Klayman in Detroit; Edited by Franklin Paul and Matthew Lewis