U.S. firms Boeing and Ford are powering ahead with China expansion plans, betting big despite the country's economic slowdown.
Boeing is set to break ground on its first overseas plane factory by the end of this month, and will aim to deliver 100 planes per year, with the initial batch expected in 2018, Chinese state media reported.
Auto manufacturer Ford is also growing in Asia's largest economy with plans to produce an all-new SUV in China for Chinese customers by the end of 2019, according to a company spokesperson. The new vehicle will be built in Chongqing, and will put the U.S. car company head-to-head with other foreign luxury car brands in China, such as Mercedes-Benz, owned by Daimler.
China's transportation industry is booming — it's already the world's largest auto market and manufacturer globally, and commercial airlines have rushed to add routes as more airports open across the country. Major companies like Boeing and Ford are seeking opportunities to gain a greater slice of the market, despite a slowdown in growth in the world's second-largest economy.
Ford's luxury Lincoln brand has been quite popular in China — last year, the company posted a stunning 180 percent growth in sales, selling 32,558 vehicles. To meet demand, Lincoln doubled its Chinese footprint in 2016 to 65 Lincoln stores and seven branches.
"The Lincoln product and ownership in China is resonating with Chinese customers even beyond our expectations," Kumar Galhotra, president of Lincoln, said in a statement. "We are now taking Lincoln to the next level by building a new SUV in China to join a dynamic lineup of imported cars and SUVs."
The Michigan-based company will still continue exporting Lincoln vehicles from North America, including its flagship luxury sedan, the Lincoln Continental, which launched last year.
Boeing's new factory will focus on finishing the interior and exterior of the company's popular commercial 737 aircraft, along with delivery to Chinese customers, according to Boeing. The plant, a joint venture with state-owned Commercial Aircraft Corporation of China, was announced in 2015 and will be located in Zhoushan, a city in northeastern China. The factory is estimated to create 2,000 jobs, reported Chinese state media.
Boeing's plans will help it to catch up to rival plan manufacturer Airbus — in 2008, the European firm opened its first assembly line outside Europe, and has since delivered hundreds of its A320 passenger jet out of that facility in Tianjin.