Ford Motor Company is engaging in a dramatic restructuring in South America. The automaker has announced it will cease all production in Brazil. Further, the plan calls for the closure of a few assembly plants.

Ford says it is ceasing vehicle production at its Camaçari and Taubaté plants immediately. Limited parts production will continue to supply the aftermarket. Additionally, Ford is leading to the closure of a Troller plant in Horizonte, Brazil in the fourth quarter. The closures mean the Ford EcoSport, Ka, and T4 will leave the South American market.

In a statement Ford partially blames the COVID-19 pandemic for the restructuring. Specificially, the company says the pandemic has amplified “…persistent industry idle capacity and slow sales that have resulted in years of significant losses.”

“With more than a century in South America and Brazil, we know these are very difficult, but necessary, actions to create a healthy and sustainable business,” Ford CEO Jim Farley said in a statement.

Ford is transitioning its South American operations to focus on sales and marketing. The company aims to import some of its most popular global vehicles to the market, including the Mustang Mach E and upcoming Bronco. Despite shuddering production, Ford will maintain a regional HQ in São Paulo. A product develop hub in Bahia will be retained as well.

Shifting to a distribution-only model is something we’ve seen significantly from rival General Motors. GM has pulled all manufacturing from Australia and Europe.

Ford says the company is taking a $4.1 billion financial hit attributed to the restructuring. Of the hit, about $2.5 billion is slated to be cash.