Should Ford go cheap in China?
The automaker is getting killed in Europe, and it can't rely on US sales alone. It needs to catch up in China.
Ford didn't get into China at all until 2002, nearly 10 years behind General Motors (GM) and decades behind Volkswagen (VLKAY), Bloomberg reports. And it just hasn't been able to make waves there since then.
Ford only has about 2.4% of China's light-vehicle market. Now, its problems there are being scrutinized closely as Ford has crashed and burned in Europe. Ford is expected to lose more than $1 billion in Europe this year. It absolutely needs to pick up the pace in China, because Ford can't be so dependent on the U.S. for its success. Ford got a reminder of that in July, when its sales in the U.S. came in below analyst expectations.
"In China, we decided -- and you can debate the intelligence of that decision -- not to offer a full range of products," Joe Hinrichs, Ford's top guy in Asia, told Bloomberg last week. "That's something we're changing."
Ford needs to change its pricing too. It sells the Fiesta subcompact in China, but the car costs 40% more than a similar car, the Chevrolet Sail, made by GM. It must lower prices to compete. Ford wants Asia to make up a third of its global sales by 2020.
This year, Volkswagen made five of China's 10 most popular passenger cars. GM had three and Ford and Hyundai each had one.
Check out the following video to see exactly how bad things are in Europe for automakers.
Ford hits a brick wall after every peak period. The Taurus front end looked like a catfish. If they fixed the look, it would have cornered the market. Instead-- phased out for the Fusion. The Fusion has been great but what started near $20,000 now starts at $30,000. They had a great thing going with the SVT re-do of the Focus and the Kona version. Once again, the higher end models now start at $30,000. It needs to occur to marketing that THEY are the only ones making that kind of money now. Chrysler is aiming for the working class dollars and winning them. As usual, GM is building what they want to and playing financial games with prices and credit.
The best ALL THREE could be doing today is flushing the marketing staff OUT and replacing them with people who live in the real world.
3 spam dating hits and 3 pretty much worthless remarks.....
Yes, Ford needs to make better inroads in China.....The Company needs to pick up profits where they can so as to help American manufacturing here at home.
Maybe some you don't want them to succeed, but like many of auto companies here, that need to keep going, because it means overall, millions of JOBS....In the U.S. too.
If you want Ford and GM to leave here and go totally to China,India and Brazil they probably could...?
And then what bread and soup line are you going be standing in, yelling about all manufacturing leaving America.....Some of you had better get some common sense, before we are destroyed...
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With so much at stake, it's no wonder the activist investor was pushing for Family Dollar to be bought out.
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