The supplier park next to Ford's Valencia, Spain, plant will double in size following the decision to produce both the next-generation Ford Fiesta and Mazda Demio replacement there.
Ford will begin assembling the Fiesta at Valencia during the second quarter of 2002. Then Mazda will begin building the replacement for its Demio supermini at the plant in the first quarter of 2003, marking the launch of Mazda manufacturing in Europe.
The strategy is designed to help the struggling Japanese maker, 33.4 percent owned by Ford, offset currency fluctuations. Mazda may also build a second car at Valencia later, the replacement for its 323.
The supplier park, which now covers an area of 660,000 square meters, will expand to take in new suppliers. There are currently 41 suppliers on-site, and an additional 10 to 20 will be added, said Antonio Ades, Valencia plant operations manager.
The Valencia regional government is spending E31.8 million to develop the supplier site, including improved logistics.
Valencia, already Ford's most flexible plant, will become even more so, eventually building four models: Focus, Ka, Fiesta and the Demio replacement. By adding Fiesta to Valencia, Ford is making up for the capacity it will lose when it stops building cars at its Dagenham, England, plant during the first quarter of 2002. Cologne, the new lead factory for Ford's supermini, will begin building Fiestas later this year. Cologne will make the regular Fiesta hatchback and a new compact minivan-style derivative.
Ades said Valencia's proven flexibility helped it to get the Mazda business. Ford and Mazda had narrowed their choice of Mazda sites to Valencia and Saarlouis, Germany, where Ford makes Focus.
Ades would not say how much Ford is spending to upgrade Valencia's assembly operations. Ford is still sensitive about its decision to stop building cars at Dagenham. Dagenham was formerly its lead Fiesta assembly plant.
Ford also announced it is investing E222 million to construct a new line at Valencia to build a new four-cylinder engine. Valencia will be the sole European source for the four-cylinder engine, which will be used in Mondeo.
To make room for the new engine, Valencia will cease production of Zetec engines at its No. 2 engine plant on March 16. Production of Zetecs is being concentrated at Ford's Bridgend, Wales, plant. Workers will retool and refurbish the No. 2 engine plant in preparation for the start of production of the new four-cylinder in 2002.
To build the four models at Valencia, shifts at the plant will increase from two to three, Ades said. Capacity will rise from about 350,000 to 410,000 units annually.
Mark Fields, Mazda president, named Akira Marumoto general manager in charge of European research and development and production operations. Marumoto will divide his time between Mazda's European research and development center near Frankfurt and Valencia. He will oversee startup of the Demio replacement at Valencia.
Ford will cease building the current Ka mini, probably in 2004. Ford has not announced if there will be a second-generation Ka.