Ford is “committed” to restructure Europe operations despite low demand

Article by Anita Panait, on September 20, 2012

Ford Motor Co. is planning to restructure its loss-making operations in Europe, which is expected to incur more than $1 billion in losses this year. Chief executive Alan Mulally remains silent about the details of the revamp during a New York media event to unveil a redesigned Fusion mid-size sedan.

Ford’s CEO admitted that there is a tremendous decrease in demand in Europe, but he gave assurances that the carmaker remains absolutely committed to the region that will involve restructuring. Ford posted a 29 percent decrease in sales in Europe in August 2012, compared to just 8.5 percent decline by the overall industry.

Currently, Europe is one of the biggest concerns of Ford. Mullaly’s possible retirement in late 2013 also gave rise to speculation and concerns by analysts and investors. 

Ford's board of directors is inclined to appoint Mark Fields, currently chief of Ford’s North and South American operations, to chief operating officer. The move would make him as heir apparent to Mulally. With regards to his retirement plans, Mullaly said he is "pleased to continue to serve as CEO of Ford." Ford’s current chief executive noted that the company has a strong bench of leaders.

Although it is developed in Europe, the new generation of the Ford Focus is underpinned by the carmaker’s new global C-segment platform, allowing the car to be sold in more than 120 markets around world with 80 percent common parts. This new global C-segment platform is also set to underpin at least 10 new vehicles, accounting for 2 million units of annual production by 2012.

Kuzak remarked that three new core Ford Focus body styles – as presented in Paris – marks a new milestone in the carmaker’s global C-car strategy. He disclosed that Ford will – in the next few months – commence production of the new Focus simultaneously in its Saarlouis and Michigan assembly sites, thereby marking the initial fulfillment of the vision to underpin 10 new vehicles from the new global C-segment platform.

Ford has confirmed in Paris that aside from the three body styles recently unveiled for the next-gen Focus, it has no plans to create three-door or coupé-cabriolet versions. Kuzak quipped that since the five-door hatchback already features a sleek, coupé-like design, there was really no need to create a three-door version. He noted that even with three models in the range, the new Focus is already able to deliver what its target market demands -- sportiness, dynamic appearance and daily practicality. Kuzak added customers seeking the same attributes but needing more space would consider the new Ford C-MAX.

Meanwhile, Ford is inching closer to fulfilling its promise of adding a performance model to the next-generation Focus. In fact, the carmaker is unveiling a close-to-production prototype at Paris.

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Topics: ford, europe



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