Prime Minister Calin Popescu Tariceanu said “the deal is the first major American industrial investment in Romania, which has been given the chance to become the largest car producer in South Eastern Europe.”
Production will begin at the end of 2008, “with a small-sized car, produced only in Craiova”, said the President of Ford Europe, John Fleming. Ford officials added that cars produced in Craiova will not be low-cost models, such as Dacia Logan. Some 90 percent of Ford production in Craiova is destined to be exported on European markets, according to Fleming. Ford plans to invest €675 mln in the Craiova-based plant, which produced 24,000 Daewoo vehicles in 2006. It intends to raise employment to around 7,000 from 3,900 at present, and plans to reach output of 300,000 units a year.
Daewoo models production may continue while the factory is in the modernization process, if Ford can reach an agreement with its American rival General Motors, which currently owns the license for models exiting the factory gate, according to Ford officials.
Besides more jobs and increased car production, the transaction is also expected to bring consultancy teams an incentive fee of up to €11 million, according to Business Standard estimates.
