Ford hopes to begin manufacturing the Focus in Russia within the next two years under a new $150 million joint venture with the Russian government.
Jac Nasser, president and chief executive of Ford Motor Co., and James Donaldson, outgoing president of Ford of Europe, met in Moscow with Russian Prime Minister Sergei Stepashin and Minister of Economics Andrei Shapovalyants to sign an agreement in principle.
The joint stock company, known as Ford Vsevolozshk, will convert the former Russki Diesel factory near St. Petersburg into a full assembly plant including body construction, paint and final assembly. Ford has set 25,000 units as its initial annual production target, but the factory will be capable of making 100,000 units a year eventually.
Partners in the joint stock company are Ford and Bankers House - St. Petersburg.
Ford has also named Alain Batty president of Ford of Russia and the CIS (former Soviet states). He was previously director of Asia Pacific and new markets for Ford. Batty, who will be based in Moscow, was present at the signing. He said Ford plans to begin converting the former engine plant in July.
Ford sold 5,070 units in Russia in 1998, down slightly from 5,200 in 1997. It sold 3,000 in 1996. Ford currently markets 10 models in Russia, including 30 derivatives. These include the Ka, Escort, Mondeo, Transit, Taurus, Explorer, Expedition and Lincoln Town Car.
Ford operates a network of 33 dealers in Russia, of which 22 have full facilities.