Ford Rival GM To Take $5 Billion Hit On Chinese Operations

The rapid rise of homegrown EV manufacturers in China took the auto industry by surprise, and traditional automakers have been racing to keep up in every region where the Chinese have established a foothold. This has greatly impacted Ford and General Motors, as their joint venture operations in China have struggled to regain their footing amid fierce competition. While the Blue Oval course corrected to the point where its operations in China are profitable, that has clearly not been the case with GM, as it has opted to write off about $5 billion to realign its footprint in the country.

As reported by our sister site General Motors Authority, GM decided to take non-cash charges of $2.6 billion to $2.9 billion in restructuring costs and $2.7 billion for the reduced value of its SAIC-GM joint venture operation in China, set to be recorded in the automaker’s Q4 2024 earnings report. The company reported losing money in China for the first three quarters of 2024. GM’s joint venture currently builds Chevy, Buick, and Cadillac vehicles for the Chinese market. That said, GM remains committed to staying in China despite the charges. In September 2024, CEO Mary Barra outlined a plan to make the company profitable in China by going upmarket and ditching unprofitable vehicles.

Like GM, Ford has also struggled to find success in the Chinese market. Reports suggest that it has given up on being a major competitor in the country and will instead focus on using its manufacturing footprint to produce vehicles for South America and beyond. Currently, the company is focused on rolling out its first low-cost EV platform in America, although executives have stated that it will directly compete with Chinese EVs on their own turf. Ford is currently struggling in other regions too, having announced its decision to pare down its European operations.