Ford Motor Co. is changing its focus from restructuring to expanding and predicts that by 2015, its worldwide sales will increase by 50% to 8 million vehicles each year. Ford is relying on the expected growth in Asia and the rising demand for small cars to boost sales.
In an interview in New York, Chief Financial Officer Lewis Booth said that in the past decade, Ford has proven that it was good at restructuring but he claims that growth is a “new skill” and “takes practice.”
According to CEO Alan Mulally, by 2020, small cars will account for 55% of vehicle sales and the Asian market will make up a third of sales.
He explained that to achieve this ambitious target, Ford has laid a “tremendous foundation.” Ford executives went to Wall Street and said that by 2015, total Automotive debt will decrease to about $10 billion.
This is a considerable drop from $16.6 billion at March 31, 2011 and from $33.6 billion at the end of 2009. Ford is hopeful that in the near future, it will return to investment grade and go back to paying dividends after "at an appropriate level of after-tax earnings."
From posting 6.1% in global automotive operating margins in 2010, Ford anticipates that it will increase to 8 to 9% in 2015. In addition, Ford expects that its operating margin in North America will be in the 8% to 10% range by 2015.