Ford selects Valencia, Spain plant as 'preferred site' to build next-gen EVs for Europe

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An employee works on Ford Mondeo vehicles on the production line during assembly at the Ford plant in Almussafes on Feb. 5, 2015, in Valencia, Spain. - David Ramos/Getty Images North America/TNS

A Ford Motor Co. plant in Valencia, Spain, is poised to become the automaker's next electric-vehicle manufacturing base in Europe.

The company said Wednesday it has selected the Valencia facility as the "preferred site" to build vehicles on an all-new, next-generation EV architecture developed by Ford as the automaker boosts its EV production capacity in the region to achieve an all-electric passenger-vehicle lineup by 2026. The selection of the Valencia plant follows a months-long assessment that also included a factory in Saarlouis, Germany.

The plan to build electric vehicles in Valencia is pending product approval. If that happens, Ford expects to start producing vehicles on the next-generation architecture later this decade.

"We are committed to building a vibrant, sustainable business in Europe as part of our Ford+ plan, and that requires focus and making tough choices," CEO Jim Farley said in a statement. "The European auto industry is extremely competitive, and to thrive and grow we can never settle for less than unbelievably great products, a delightful customer experience, ultra-lean operations and a talented and motivated team."

In March, following the announcement that it would separate its legacy combustion engine and EV businesses into separate units, Ford unveiled an acceleration of its electrification strategy in Europe.

That includes the introduction of seven new all-electric passenger vehicles and vans by 2024, as well as a new joint venture to boost EV battery production in the region.

Ford is targeting 600,000 EV sales annually by 2026, by which time it expects to have annual sales of 2 million EVs globally. Ford is targeting zero emissions for all vehicle sales in Europe and carbon neutrality across its footprint in the region by 2035. It expects its entire passenger-vehicle lineup in Europe to be zero-emissions capable, all-electric or plug-in hybrid by 2026.

Ford next year will launch production of an electric, five-seat, medium-sized crossover at its Cologne Electrification Center in Germany. That vehicle will be built on a Volkswagen AG platform, under the terms of a strategic alliance between the two automakers.

An electric sports crossover will be added to production lines in Cologne in 2024. With those two vehicles, EV production at that facility will increase to 1.2 million units over a six-year timeframe, Ford said at the time. The company has said it expects to invest about $2 billion in building those new electric passenger vehicles in Cologne, including to establish a new battery assembly facility there in 2024.

The expansion of Ford's EV lineup in Europe — which already includes the Mustang Mach-E and the E-Transit cargo van — also will include an electric version of the Ford Puma, as well as four new commercial EVs.

Now, the Valencia plant is being eyed for second EV platform as the automaker looks to boost production capacity to meet its electrification goals and compete with rivals in the region — including Tesla Inc., which recently launched production at a factory in Berlin, Germany.

Still, the Valencia team must restructure the plant before Ford invests in a specific product there. That plant, located in Almussafes, dates to 1976 and currently employs about 6,000 workers building a handful of models, including the Ford Kuga.

"Bringing our all-new electric vehicle architecture to Valencia will help us build a profitable business in Europe, secure high value employment and increase Ford's offering of premium electric, high performance, fully connected vehicles that meet the demand of our European customers," Stuart Rowley, chair of Ford of Europe and Ford's chief transformation and quality officer, said in a statement.

Ford officials said no decisions have yet been made on the future of the Saarlouis plant, which is slated to continue assembling the Ford Focus until 2025. The company is "evaluating options for future site concepts," according to a news release.