Ford Abandons Heavy-Truck Market in South America

Ford Motor Co. is exiting the heavy-duty commercial truck business in South America later this year.

The move will result in a $460 million special charge and the end of 2,700 jobs at the company’s factory in Sao Bernardo do Campo, Brazil. The 52-year-old plant once made a variety of cars and trucks. Currently it assembles F-350 and F-4000 Cargo trucks and Fiesta small cars.

Last summer Ford reportedly approached Fiat Chrysler Automobiles and Volkswagen about buying the Sao Bernardo facility. At the time, Ford told analysts that the company’s South American operations “lack a strong competitive position or profit pillars.”

Ford says the Brazilian complex will stop production when it runs out of parts. The closure follows other cost-cutting moves in South America that include a reduction of more than 20% in salaried and administrative costs over the past few months.

The South American cuts are part of the global restructuring plan Ford first outlined last July. That program is expected to incur $11 billion in pretax charges.