Ford and Geely Reach Deal for EV Production at Spanish Plant, ABC Reports

Ford Motor Co. and Chinese automaker Geely have reportedly struck a landmark agreement for Geely to begin manufacturing electric vehicles at Ford's assembly plant in Almussafes, Spain. The deal, reported Wednesday by Spanish newspaper ABC, would involve the U.S. automaker selling a portion of the facility to its Chinese counterpart.

Details of the Reported Agreement

Citing sources familiar with the matter, ABC reported that an official announcement is expected on Thursday during a visit to the plant by Spanish Prime Minister Pedro Sanchez and Ford Europe President Jim Baumbick. The agreement would allow Geely to produce its EX2 electric vehicle at the Valencia-area facility.

As of the report, neither Ford nor Geely had officially confirmed the deal, with the companies not immediately responding to requests for comment, according to Reuters. The partnership would represent a significant strategic move for both automakers in the European market.

A Mutually Beneficial Arrangement

For Geely, which owns brands including Volvo, Polestar, and Lotus, the deal provides a critical manufacturing foothold within the European Union. This would allow the company to:

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• Avoid potentially steep EU tariffs on electric vehicles imported from China.
• Gain direct and more efficient access to the vast European single market.

For Ford, the arrangement offers a solution to the uncertain future of the Almussafes plant. The facility has faced challenges as several models are phased out, leaving it heavily dependent on production of the Kuga SUV. By sharing infrastructure, Ford can reduce its fixed costs and help safeguard local jobs and production capacity.

Market Context and Implications

This reported deal is indicative of a broader trend where Chinese EV manufacturers are seeking to establish production bases in Europe to mitigate geopolitical trade risks and grow their market share. It follows moves by competitors like BYD, which is building a plant in Hungary.

For investors, the Ford-Geely partnership highlights an innovative strategy for legacy automakers to manage underutilized assets during the costly transition to electric vehicles. It also underscores how Chinese brands are aggressively pursuing localization to de-risk their international expansion plans amid shifting trade policies.