Ford Motor Co., announced Monday that it will close all operations in Japan and Indonesia by the end of 2016, saying that it sees "no reasonable path to profitability" due to market conditions in each country.
"After pursuing every possible option, it has become clear that there is no path to sustained profitability, nor will there be an acceptable return over time from our investments in Japan or Indonesia," said spokeswoman Karen Hampton in a statement, according to the Detroit Free Press. "Therefore, we will cease all operations in these markets before the end of 2016 and concentrate our resources elsewhere."
The shuttered operations include dealerships, as well as the sales and importation of Ford and Lincoln Vehicles. As such, product development traditionally carried out in Japan will be carried out elsewhere.
"Unfortunately, this also means that our team members based in Japan and Indonesia will no longer work for Ford Japan or Ford Indonesia following the closures," Asia Pacific President Dave Schoch wrote in an email to employees, according to Reuters.
Ford has experienced difficulties selling vehicles in Japan despite beginning operations there in 1974 and having 52 dealerships across the country. In 2015, Ford sold about 5,000 vehicles and has less than 2 percent of the imported new car market.
"Japan is the most closed, developed auto economy in the world, with all imported brands accounting for less than 6 percent of Japan's annual new car market," spokesman Neal McCarthy wrote in an email message, according to the Associated Press.
Ford fared even worse in Indonesia, where it entered the market in 2002. In 2015, among its 44 franchised dealerships, the Dearborn, Mich., automaker sold roughly 6,000 vehicles, marking less than 1 percent of the market share.
"In Indonesia, without local manufacturing...there's just really no way that automakers can compete in that market, and we do not have local manufacturing," said a Ford spokeswoman based in Shanghai, confirming the content of the email.
Despite shuttering operations in both Japan and Indonesia, the Asia-Pacific region continues to be a critical region for Ford. For example, Ford sold in 1.1 million in China last year, marking a 3 percent increase from 2014.
