Question

In 2009 the Ford Motor Company announced plans to spend $490 million on

Answer 1

Answer:

• Cheaper labor.  
• Cheaper auto parts.

Explanation:

China has cheaper labor rates than the United States in comparative industries including in the motor vehicle producing industry. Ford may want to take advantage of this to make cars at a smaller cost in China and therefore make more profit in sales.

Car parts are also easier and cheaper to acquire in China. Steel for instance, is a very valuable commodity in motor vehicle manufacturing and China happens to be the largest producer in the world. Having access to cheaper materials would increase Ford's profitability as well.