Ford and Geely agree EV production deal at Spanish plant, ABC reports

• The deal gives Geely, owner of Volvo, Polestar and Lotus, a manufacturing base inside the EU to avoid tariffs on EVs imported from China while gaining direct European market access
• Ford will reduce fixed costs through the plant sale arrangement at its Spanish facility
• Geely plans to produce its EX2 electric vehicle model at the Almussafes plant under the agreement

Ford and Geely Strike EV Production Deal in Spain

Ford Motor and China's Geely have reached a landmark agreement for electric vehicle production at Ford's Almussafes plant near Valencia, Spain, according to ABC newspaper reports. Under the deal, Ford will sell part of the facility to Geely, enabling the Chinese automaker to manufacture EVs within the European Union.

Key Details:

• Official announcement expected Thursday during a visit by Spanish Prime Minister Pedro Sanchez and Ford Europe President Jim Baumbick to the Almussafes plant
• Geely plans to produce its EX2 electric vehicle model at the facility
• Neither Ford nor Geely have officially confirmed the agreement

Strategic Implications:

For Geely, the deal provides crucial benefits including:

• Manufacturing base inside the EU, allowing the company to circumvent EU tariffs on Chinese-imported electric vehicles
• Direct access to the European market
• Expansion of its portfolio, which includes Volvo, Polestar, and Lotus brands

For Ford, the arrangement offers:

• Reduction in fixed costs through partial plant sale
• Ability to optimize its European manufacturing footprint

Market Context:

This partnership reflects the evolving landscape of EV production, where Chinese automakers are increasingly seeking EU manufacturing capabilities to avoid trade barriers while established Western manufacturers look to streamline operations and share infrastructure costs. The deal represents a pragmatic solution for both companies as the automotive industry accelerates its transition to electric vehicles amid intense competition and pressure to localize production within key markets.