Jim Farley is the new leader of Ford of Europe, taking office just months ago, but he is already making positive predictions about the regional unit’s financial situation – which could turn up profitable at the end of the year.
The European division has already managed to come level financially during the second quarter, but Farley refrained from setting a timetable for the complete financial recovery of Ford’s European unit, which has been impacted heavily by the massive sales protraction in Russia, where the American automaker committed to heavy spending in terms of factories and new products. The senior executive now believes the faith in the Russian power will be fruitful and has also highlighted the expanding sport utility vehicle model range. After losing $1.1 billion in 2014, the second quarter marked an important threshold as the company was almost at breakeven point. The executive also says higher-transaction-price vehicles are now entering the lineup refreshed – the S-Max and Galaxy large minivans and more options in the Mondeo range.
Meanwhile, the European market recovery is still rather feeble, because from a profit standpoint there are worrying factors: retail growth is in the southern region where traditionally the transaction prices are lower. Meanwhile, the fleet, rental and dealer self-registrations are showing the biggest advancements and these typically impact very little profits. And the situation in Russia is very challenging even as Ford has localized seven products and just started using a new engine facility. Ford is now also delivering an improved SUV lineup in Europe: the re-positioned EcoSport subcompact, the Kuga and all new Edge in the large class.
Via Automotive News Europe