Ford Motor is preparing to close its vehicle assembly plant in the Philippines in December 2012 with production for the ASEAN region being consolidated in Thailand and Malaysia.

The Santa Rosa plant employs 250 people directly and many more indirectly through suppliers and support services. It was opened in the mid-1990s and is so far the country’s only ever exporter of new vehicles. 

A total of 80,000 units were exported to other ASEAN markets between 2002 and 2010 – primarily to Indonesia and Thailand.

The company cited low economies of scale in the domestic market as the main reason for the closure - and a lack of a large volume model for the local market. It also said the weak components industry also had a major bearing on its decision to abandon production in the country.

Until the end of December, Ford will produce only the Escape compact SUV at Santa Rosa, having already transferred production of the Focus car to Thailand earlier this year.

The Ford and Mazda brands combined sold 6,855 vehicles in the Philippines in the first nine months of 2012, for a combined market share of 5.2%. Total vehicle sales are expected to reach 180,000 units this year, compared with an expected 1.35m units in Thailand and 1.1m in Indonesia.

Earlier this year, Ford completed a new 150,000 unit per year plant in Rayong, Thailand at a cost of US$450m. This raised its annual production capacity in Thailand, including its AutoAlliance joint venture plant with Mazda, to 445,000 units.