Sales have halved since 2015 – and now the Chinese are eating its lunch
Ford is not the force it once was in Europe: in the past 10 years, the American giant has gone from being the second-biggest car brand in Europe (after Volkswagen), with sales of just over one million, all the way down to 12th last year after sales halved.
Its market share dropped from 7.0% to 3.7%, according to European automotive industry group ACEA.
Arresting the slide is the immediate task of newly appointed Ford of Europe president Jim Baumbick. An American development engineer who did a stint overseeing the Focus and Kuga in Germany, Baumbick is the first to hold that title since Briton Stuart Rowley departed in 2022, signifying a renewed focus on Ford’s European product strategy.
In Ford’s largest European market, the UK, the change in the Blue Oval’s fortunes has been stark. In 40 years the brand has gone from leading the market with a 26.5% share to fourth with a 5.8% share in the first nine months of this year, according to the SMMT.
The drop has hit the brand’s dealers hardest. Back when the Peoples Ford dealer group was established in 1983, Ford took four slots in the UK top 10, led by the best-selling Escort. The brand can still boast the UK’s best-selling car with the Puma, but one hit model is not enough to generate the sales needed.
Last year, Peoples ended more than 40 years of brand exclusivity with Ford to strike partnerships with Chinese newcomers BYD and Chery-owned Omoda and Jaecoo. “Ford’s decision to stop Fiesta production and go all in on electric vehicles has proved to be challenging,” said chairman Brian Gilda.
Other dealers are having to do the same as Ford works to achieve its goal for this year of halving its retail network in the UK from 400 sites in 2020.
Gilda’s decision has proven wise. The combined UK market share of BYD, Omoda and Jaecoo in September beat that of Ford, underlining the seriousness of the threat presented by the Chinese to established volume players.
Market troubles
Over the years, Ford has shrunk its model range. In the coming weeks it will end production of the Focus, which becomes the latest to depart the line-up after the Fiesta, S-Max and Galaxy in 2023, the Mondeo in 2021 and the Ka in 2019.
Whereas American rival General Motors waved the white flag and exited Europe in 2017 (although it is now relaunching here), Ford’s aim has been to reverse a chronic run of unprofitability in the region by moving from being a ‘generalist brand selling multiple cars at tight or negative margins to one with fewer but theoretically more profitable ‘hero cars’.
Now its car sales are mainly resting on the success of the Puma, the UK’s best-selling model in the nine months to the end of September, at 41,531, according to the SMMT. Its next best-seller, the Kuga, sold less than half that, at 18,827, with the moribund Focus in third.
It’s a much rosier picture on the commercial vehicle side, with Ford taking the top three spots in the first nine months in the UK, led by the Transit Custom with 38,185 sales, followed by the larger Transit and Ranger pick-up truck.
Ford’s successful Transit strategy has been underpinned by low-cost manufacturing in Turkey, a fruitful partnership with industrial conglomerate Koc in the country and an iron grip on a market that so far has had little in the way of disruption from Japan, Korea or China.
Ford’s commercial vehicle success is in contrast to its car strategy. Sales of the Volkswagen-based Explorer and Capri electric SUVs (two of the new ‘hero cars’) have been sluggish to the point that Ford announced it would cut 1000 jobs at the Cologne factory that builds them once it moves workers to a single shift in January. The Explorer EV hasn’t been the big seller Ford needs it to be.
Jobs to do
Baumbick’s first job is to oversee the launch of a new model due to come out of Ford’s Valencia plant in Spain in 2027. So far all Ford will say is that it’s a “multi-energy vehicle”, but Autocar understands that it will be an SUV slightly smaller than the Kuga, essentially replacing the Focus and rivalling Volkswagen’s hugely successful T-Roc. It is expected to offer hybrid, plug-in hybrid and possibly electric powertrains.
Recent promises from within the European Commission to reduce some of the burdens on makers of small cars in the EU could also persuade Ford to explore the prospect of a Fiesta replacement, perhaps also using Volkswagen components.
The Kuga – currently the only model built at Ford’s Valencia factory – will also be under review as it approaches its sixth year in service. The plug-in hybrid version has been essential to Ford’s CO2 emissions strategy for a while now, but with a 14.4kWh battery giving an electric-only range of 41 miles, it will no longer be competitive under new EU rules that increases the assumed combustion driving time, thereby raising the car’s official CO2 figure and cancelling some tax benefits.
The Kuga is also under threat from the Chinese brands embraced by Peoples and other dealers. They offer cheaper plug-in hybrid SUVs such as the Jaecoo 7 and BYD Seal U, both of which have this year overtaken the Kuga – once the UK’s biggest-selling PHEV.
The new Ford SUV out of Valencia has the incredibly difficult task of challenging the Chinese on price while differentiating itself from Ford’s already quite broad range of SUVs.
The brand remains strong, but the question is whether it’s strong enough in the UK to keep hold of buyers who have proved more than willing to experiment with new brands in return for more kit and cost savings.
