News: Ford Mondeo production shifts to Spain

Ford has confirmed today that it will be shuttering its factory in Genk, Belgium and transferring production of the new Mondeo to its Spanish factory in Valencia.

The news will have come as a terrible blow to the 4,300 people Ford currently employs in Genk, building the Mondeo, S-Max and Galaxy. The all-new Mondeo, based on the US-market Ford Fusion, had been earmarked to be built in Genk, but when Ford delayed its European market introduction by 6 months, we smelled a rat. There were even rumours that production of the Mondeo would move to low-cost Mexico, but yesterday the announcement came that Genk was going and Valencia was getting the gig.

That means that Genk will continue on its current four-day-week for a time yet, turning out the current Mondeo and S-Max & Galaxy, but will be progessively closed down as production of those models winds up. No word let on whether Valencia gets to build the next S-Max and Galaxy, but it's likely.

The move comes as Ford seeks to both stem losses of €404-million this year in Europe, and against the background of a meltdown in European car sales that is seeing the long-standing problem of over-capacity in the industry (too many factories turning out too many cars for too few buyers) finally being tackled. Fiat has already closed a facotry in Sicily and may close another, PSA Peugeot Citroen has earmarked its Aulnay plant for closure and GM's Bochum plant in on the chopping block too.

News: Opel, Peugeot & Citroen to merge?

Troubled car brands Peugeot, Citroen and Opel could be set for a full-on merger, which could see either General Motors buying out Peugeot and Citroen from parent company PSA or Opel and Vauxhall moving into French ownership.

The proposed move, reported by Automotive News, is still very much at the embryonic stage. GM and PSA have already linked Opel and Peugeot-Citroen in a parts and manufacturing sharing agreement designed to give the two firms €2-billion in savings every year and to try and get them back on their feet in the face of increasing competition from Volkswagen and Hyundai-Kia.

A full-on merger or buyout is a beast of a different type though, and would face colossal hurdles from unions, politicians and legal ramifications. For a start, it would almost certainly see the closure of at least one or two more major factories, above and beyond the closures and job losses already being planned in France and Germany. Secondly, with car making still being seen as a political jewel in the crown in both nations, it's hard to see France or Germany's politicians standing idly by while one side or the other is sold off.

While this news has only broken this week, apparently initial discussions on the subject were held earlier this year when the PSA-GM tie-up was first announced, and it's thought that the worsening European car market, combined with investors and analysts putting major pressure on GM to do something, anything about ailing Opel, is putting the plan back on the front burner.