Ford to double capacity at Wales engine plant

RUSSELL HOTTEN

Ford, the US car company, was today hoping to confirm plans for an investment of more than pounds 300m to double capacity at its engine plant in South Wales.

The company's executives were last night said to be putting the finishing touches to the plan, which is expected to be announced by the Secretary of State for Wales, William Hague.

The Government is backing the project with state aid, and officials worked hard behind the scenes to persuade Ford to choose its Bridgend plant against competition from factories in Spain and Germany.

"There are still one or two administrative things to be sorted," said a Ford spokesman. "We are hopeful of news."

The investment is likely to provide a huge jobs boost, both at Bridgend and among UK components suppliers. Speculation that the investment would be between pounds 250m and pounds 300m were said by one Ford source to be "a bit shy of mark".

The Bridgend plant employs about 800 workers and produces about 550,000 engines a year, including engines for Ford's popular Mondeo model. Last April, Ford said it was putting another pounds 200m into a new production line for diesels at its Dagenham plant in Essex. The expansion means Bridgend will make the 1.25 litre Zetec engine for Ford's new Fiesta car, which will be unveiled at the London Motor Show on Thursday.

Alex Trotman, Ford's chairman, told a conference yesterday: "We feel very good about prospects for 1996. We are going into 1996 with an extremely strong product line."

For the industry as a whole, 1996 would be a stronger year than 1995, and further improvements are likely in 1997, Mr Trotman said. He added that Ford is looking to add an additional 200-300 new dealers in Japan as part of the US/Japan car agreement, in addition to its existing 300 dealers.

"We'd like to sign some of the very strong indigenous Japanese dealers, primarily Nissan and Toyota." He added that the strong Japanese auto sales presence in the US was built up on the back of Ford, General Motors and Chrysler dealers.

Meanwhile, Rover car company today confirmed that it was exploring the possibilities of building a new engine plant, possibly in the West Midlands.

"We will eventually need new engine facilities and it is likely that we will make a decision within the next six months," a Rover spokesman said.

However, BMW, Rover's parent, played down the suggestion. "Neither the plant's capacity, nor how much we will invest in it, nor its location, has yet been decided," a spokesman said.

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(Q) - Quarterly (F) - Final (I) - Interim