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Also suffering from the European contagion is Ford. The blue oval’s western European are down 10 percent in the first half of 2012, Reuters says. June sales are down a hefty 16.1 percent.
Once Ford releases Q2 results, overseas losses are expected to be up threefold from the $190 million recorded in the first quarter. Ford already fingered Europe as the culprit.
GM Europe has not yet reported first half sales figures for Opel. In May, Opel’s year-to-date sales were down 12.3 percent in the EU, Ford’s were down 12.8 percent. Please note that different companies have a different view of what is part of their “Europe.” The European manufacturer association ACEA will release its numbers next week.
13 Comments on “Ford Down In Europe, Expects Big Hit On Earnings...”
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And here is why ‘One Ford’ is so amazingly short sighted.
People don’t want your products in one area….so selling those same products (that people don’t want) everywhere, will lead to dealers full of dust collectors.
Ford is going to have to rely on fleet sales even more until they get the products fixed.
Is One Ford any more shortsighted than VW’s new modular platforms? It costs a billion dollars to develop a new car, so amortizing those costs across multiple markets makes a lot of sense. Selling a different, and inferior, Focus in the US was a big mistake. Of course attention has to be paid to local market trends and desires, but you can localize a product while it still shares components and sheet metal with cars sold in other markets.
Ronnie, don’t usually disagree with you here but I have to now. Yes One Ford is short-sighted. At least from my perch in the world. WHile you all consider the Focus a base car, a Focus is an aspiration here in BRazil. It’ll never make the top 10 in sales cause it’s just too expensive. Here fighting for 1st place are things like Fiesta and Ka. And therein lies the problem, while Fiat manages to make the Uno and Palio especifically for us, as does VW with Gol, somehow both VW and Fiat keep their bottom feeders fresh and exciting and noboby remembers or cares they’re not sold in Europe or US. GM and Ford meanwhile feed us leftovers from the 90s. No wonder they can’t compete.
Ford here is struggling to keep 4th place. They were part of the traditional Brazilian Big 4. I predict that in 2 yrs they’ll be overcome by Renault.
so, they need some special for the rest of the world to keep up. Like Hollywood, which now gets more than 50%¨of it revenues from places other than the main centers, the auto industry has to adapt. China, Latin America, Eastern Europe, the Middle East among other regions are increasingly becoming the places to be. And it looks like it will remain so for the short term future. Long term? Even more so.
“Is One Ford any more shortsighted than VW’s new modular platforms?”
The point of a modular platform is to make differentiation more affordable, in order to have more differentiation. Platform flexibility is the exact opposite of a one car strategy.
Now that VW is pushing to build share in the US, it did what all of its larger competitors did — made a version of its mid-size sedan that was primarily US-specific. That’s what Honda did with the Accord, Toyota did with the Camry, and Nissan did with the Altima in order to play in this class.
That being said, Ford isn’t weak in Europe because of a One Car strategy, but because its branding is too weak there to support executive class (read: high margin) cars. The automakers that are doing in well in Europe are those that sell near-luxury and luxury models at high prices. Company cars are common perks for European middle managers, and they want to lease status. They’re able to get that status from a BMW, Mercedes or VAG vehicle, but not from Ford.
The poster above (fka P71 something or another) is still pining away for his now-dead Panther. The Panther is about as relevant to today’s marketplace as a brontosaurus, and he needs to get over it, because it ain’t coming back.
Silvy is back! If you hated GM as much as Ford, I’m sure you would immediately be offered a spot as a writer for TTAC.
One Ford just means reducing the number of global platforms, not selling the exact same car in every market (much like VW is now doing with the MQB architecture.) Europeans can still buy diesels, wagons, and 2-door variants that we don’t get in the US. There is no reason whatsoever for the European Focus to be a completely different car from the US Focus, especially when Toyota is selling almost the exact same Corolla in every market. But let’s not let facts get in the way of another one of your baseless anti-Ford rants.
Actually ‘One Ford’ does mean selling pretty much the same vehicle across markets (this is what VW used to w/o much success in the US until they recently changed tactics).
Toyota, Honda, Nissan and Hyundai all have different lineups in Europe than they do for the US.
While Toyota does sell the Corolla in Europe, it’s not a big seller (more for the Eastern European market), with the Toyota Auris also Corolla hatchback in certain markets) being the real competitor iu the compact segment.
Instead of the Camry, Toyota Europe has the Avensis.
Same goes for Honda – the Euro Civic is different and the Euro Accord is what we know as the Acura TSX.
Same goes for Hyundai – the i10, i20, i30 and i40 instead of the Accent, Elantra and Sonata.
While there are some models which are sold in both the NA and Euro markets, the lineups are quite different.
86 – your post is factually incorrect. Ford is one of the biggest manufacturers in Europe and speaking from the UK perspective it has usually the best selling sub-compact (Fiesta) and compact (Focus) car in the country (volume around 200,000 in the UK alone).
‘One Ford’ has hurt Ford in the US more than it has in Europe – since the models were basically European anyway.
The smaller rear passenger room and the higher prices have hurt Focus and Fiesta sales in the US.
Pretty much all the automakers are hurting in Europe (esp. the French and Italian makes); even VW saw a slight drop in sales for the 1st half compared to last year.
One Ford failing? Ford opened a new factory in Chongqing, China, I believe in February to build the new Focus. Ford Focus (same one sold worldwide) was the best selling car in China last month for the first time. However, looking at the monthly statistics you’ll see it’s been on a tear, growing month to month, so it was largely a capacity constraint. In fact, the Focus is the world’s best selling single design right now. Yes, the Focus may be a bit rich for Brazil, so they should bring out some lower cost products. But being #1 in the world’s largest market, plus high on the charts in Europe and US also on what is truly one single car design is huge for the bottom line.
Years ago this or that less developed European country would be known as “the weak sister of Europe”. Now it appears that all of Europe is a weak sister.
At the NAIAS this year someone asked Marchionne about Europe. He made a sour face and he said it was at best going to be flat for at least two years.
This is where Ford’s weakness in Asia (China) really hurts them.
As was previously stated in the Opel thread, this is a direct reflection of the overcapacity in Europe. Too many simialr models fighting for sales. Someone needs to die and let the rest breathe.
PSA, Renault and Opel look like the obvious culprits but it could be someone else. Vauxhall? SEAT? Parts of FIAT? Until that happens, Ford is going to be running into problems. Not enough to get them out of the market but will put pressure on Dearborn to make moves.
Leaving Europe would be a Bold Move