Ford Motor Co is cutting production in Europe and invested in seven new plants in the Asia-Pacific region, the US company’s chief executive said on Tuesday.

“Europe is clearly a concern for us all,” Alan Mulally said.

“We are forecasting a $2-billion loss in our European operations, because the economy is down and the industry is down,” Mulally said in Thailand ahead of the annual Bangkok Motor Show.

Ford has this year scaled down production in Europe, where sales have hit a 17-year low, following the strategy it pursued in the recession-hit US market a few years ago.

“The most important thing we’re doing (in Europe), and we were the first to do it, is to bring down our scale of production so we can match our production to real demand,” Mulally said.

The chief executive forecast it would take time for Europe to work through its sovereign debt crisis, but he expressed optimism about the US and Asia-Pacific markets.

“As the (US) economy starts to come back we are seeing tremendous demand for our vehicles,” Mulally said.

In the Asia-Pacific region, Ford has invested in seven new assembly plants this year, mostly in China, and last year opened a new assembly plant in Thailand and another in China’s central region of Chongqing.

China is already the world’s largest market for vehicles, with annual sales estimated at 19-20 million a year, compared with 15-16 million in the United States, he noted.

In Thailand, domestic sales of vehicles reached 1.4 million last year, while 1.2 million were also sold in Indonesia.

“So many people are moving into the range where they can buy a car, and when people have enough disposable income they want to travel and they want the freedom a car brings,” Mulally said.

“Asia-Pacific is going to have more than a third of the total market very fast,” he predicted.

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