"I don't get hung up on the 10%," Wallace said. "The issue really is how do we get a significant presence in the whole region?"

A two-pronged approach calls for maximizing the developed markets of Australia, New Zealand, and Taiwan, and expanding operations into the "new markets"—the rest of Asia. Ford has plants operating or under construction in several of these new markets, including China, India, Thailand, Vietnam, Malaysia, and the Philippines.

The company has just built a greenfield plant in India to produce a Fiesta-based car that, when launched later this year, will be unique to the Indian market. "Whether you'll end up with all sorts of unique vehicles in Asia, I think that's an open question," Wallace said. "I think we'll have some unique vehicles, and some that will be based on the kinds of vehicles we're selling around the world. It will be a mix and match."

And there will be "no one recipe" dictating which models will be imported or exported from where to where, according to Wallace. Because many Asian countries limit sales of imported built-up units by way of high duties and local content regulations, assembling vehicles locally is a logical approach. Not in every case, however. "Different solutions for different markets," Wallace likes to say.

Local production was found to be the smartest approach in Thailand, where Ford and Mazda began building Mazda-designed Ranger pickup trucks together at a plant near Bangkok last summer. In this case, the pickups were not designed uniquely for the Thai market (Thailand, behind the United States, is the second-largest buyer of pickup trucks). So, with a greatly weakened Asian economy, the company is able to maintain the plant's viability by exporting the trucks around the world.

Wallace doesn't see duties falling "as fast as people hope or expect" throughout Asia. He expects the decrease to be fastest among and between the countries that make up ASEAN (Association of Southeast Asian Nations). Most major nations of Southeast Asia are members of that trade alliance.

"Hopefully, over time, as the barriers come down and as we get a manufacturing base in the region, we will have the capability to start to cross-share," Wallace said. "We're beginning to look at supply-base-type strategies where we can cross-ship components within the region, but I think that's going to be a long-term trend and until those barriers come down I think everybody is going to have a suboptimized position in the Asian region."

Unlike co-ASEAN member Thailand, where Ford relies on dozens of Thai-based companies to supply 70% local content for the Ranger, Vietnam has a "nonexistent" supply base. It's somewhat better in the Philippines, where Ford is building an assembly plant. "The region has a long way to go," in terms of supply base development, Wallace said.

In China, Ford's holds 30% equity in a joint venture with Jiangling Motors Corp. to build Transit buses with a mixture of local and European-sourced content. It also has several joint ventures with Chinese partners for production of engines and components. "We'd like to do more, but obviously that's a matter of how China unfolds in terms of its automobile legislation," Wallace said. "It's hard to say what that might be right now. China has a whole range of initiatives, so we continue to work and look for opportunities, but we're dependent on where the government goes."

Ford is depending to a large extent on its affiliate, Mazda, for engineering expertise—as it did for the Thai Ranger. "We have a strategic relationship with Mazda, and within that we are moving toward global platforms that both companies can share, as well as global powertrains where it makes sense," Wallace said. "Mazda is working on some programs, Ford on others. We've never truly declared to the world which will have what responsibilities, but that whole process is moving along pretty well."

One project under way for the Asian market is a sport utility vehicle to be sold as a Ford and a Mazda. It is too early to say how the acquisition of Volvo will help Ford expand in Asia, "but I see synergies everywhere," Wallace said.

Development of an "Asian car" is not part of Ford's plans for the region. The company doesn't even like to use terms such as "Asian car" or "world car."

"There are certain requirements in terms of package, price, and the capability of operating in that area, but I don't see that that requires an 'Asian car,'" Wallace said. "We need to make sure that the cars we develop are developed with Asian driving requirements in mind. That's not to say we will not tailor our cars to the Asian market, but I don't think it necessarily implies a car only for Asia."

Wallace made his point by referencing the success of Toyota's Corolla, which is sold globally, and its less successful Soluna, which was launched as an "Asian car."

Soluna notwithstanding, Toyota is the dominant player in Asia, especially in ASEAN nations. Even with the help of Mazda, it will be an "uphill battle" for Ford to capture 10% market share in Asia. "We think we're focused on what we need to do to compete," Wallace said.

Patrick Ponticel