Ford wants to cut reliance on European rental-car companies

Article by Anita Panait, on June 19, 2013

Ford Motor Co. is banking on models like the EcoSport small sports utility vehicle to help reduce its dependence on low-margin sales to rental-car firms in Europe as it bids to plug its losses in the continent. Deliveries to rental fleets currently account for 17 percent of Ford’s sales in Europe, and the carmaker is planning to trim the figure to 13 percent by early 2015, according to Roelant de Waard, the Ford’s head of sales for the region.

Ford is planning to continue to increase the proportion of sales to retail and company-fleet buyers, which usually order cars at higher prices. The carmaker expects its losses in Europe to increase from $1.75 billion in 2012 to around $2 billion this year, but also foresees a rebound in the region’s market in 2014. According to de Waard, they are “expecting some improvement next year" in industry-wide demand in Europe.

He expects sales in the carmaker’s major European markets to surge to around 14 million vehicles in 2014 from around 13.5 million this year. The carmaker posted a 2.2-percent drop in deliveries to 99,400 vehicles in 19 European markets in May.

The drop, however, is lesser than the industry average in Europe, allowing Ford to increase its market share in the month to 8.3 percent, the highest level since 2009, the carmaker said in a statement. De Waard remarked that that with the “newness and the freshness” of Ford’s model lineup, they expect gains in market share in Europe next year. De Waard expects the European vehicle market to remain at current levels through the rest of 2013. [source: Bloomberg]

Topics: ford, europe

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