The second largest American automaker Ford (F, Financial), in collaboration with its joint ventures managed to sell 100,834 vehicles in China. The automaker produces vehicles in joint venture with Chongqing Changan Automobile Co. and Jiangling Motors Corp. This is an improvement of 2% over the same period last year. At least its November sales figure showed a hike year-over-year compared with the previous two months that experienced sales dip. In October, the carmaker saw a sales drop of 1%, and in September, sales declined 0.2%. Let’s take a quick look at the numbers and assess Ford’s position in China.
Ford Lincoln
Number Crunching
While sales have been a bit erratic, the positive takeaway is that the company has managed to cross the 1 million units sales mark in the first 11 months of the year. Ford has delivered 1,007,425 vehicles through the year with another month remaining. Under the Changan Ford joint venture, the company reported sales of 729,711 passenger cars in the first 11 months of the year, which is an improvement of 20%. This is noteworthy considering that November sales reduced 5% to 69,145 vehicles. One the other hand, Ford and Jiangling Motor’s sales jumped 17% to 245,066 vehicles through November this year, and 23% in November.
The company says that one of the biggest challenges that it faces in China is constrained production capacity. This is precisely why the American automaker is not able to stabilize its sales and operations in this emerging market.
Side by side with competitors
In comparison, arch rival General Motors (GM, Financial) along with its partners sold 310,000 vehicles, which is up 5.3% relative to a year earlier. The top Detroit automaker has so far delivered 3.2 million vehicles in China. This is more than three times the sales of Ford. Buick sales went up 4% to 78,923 units, Chevrolet rose 7% to 64,006 units, and Cadillac saw a rise of 9% to 6,818 units in China.
General Motors’ vast lead over Ford is owning to the former’s early arrival in the Chinese market. And this seems to be paying off the carmaker very well, as visible in the numbers. Besides General Motors, Volkswagen (VLKAY, Financial) is the other big foreign automaker with wide presence in the mainland. Both these automakers stepping in the Chinese market when the market had much lesser players to compete with. With stylish and reliable offerings, General Motors and Volkswagen became popular in the market which has helped them to become the two most prominent foreign automakers in the country.
Ford, in comparison, is a late entrant in China. The Blue Oval has a long way to go to match the likes of these automakers in this Asian market. “Crossing the million vehicle mark is a significant milestone for Ford in China, and it demonstrates the appeal of our portfolio of high-quality, safe, fuel-efficient and smart vehicles,” says the company’s China CEO John Lawler. Ford has aggressive plans to expand its penetration in the world’s hottest auto market. It is doing a number of things, from increasing capacity to widening its portfolio of cars.
The Lincoln Brand finally released
Releasing the Lincoln brand in China clearly shows how Ford is serious about increasing its offerings and entering the luxury car segment. It unveiled the Lincoln brand in China which will not only support its profit growth and add to its sales, but also help to tap a new market and increase its market share.
There was a time when the company was considering shutting down the Lincoln brand completely. But sensing luxury car demand in China, Ford is hopeful to revive the Lincoln brand. According to a research study, it has been found that Chinese consumers hold the Lincoln brand higher than Volkswagen’s luxury brand Audi and Toyota’s premium car brand Lexus. This is a positive sign for Ford’s Lincoln. Now that the Chinese luxury car segment is expected to grow over the next years, it could mean big business for Ford. The carmaker predicts that by 2020 the world’s luxury car market could grow to 10.7 million vehicles, and China’s going to be a big driver. This US automaker aims to gradually grab the China luxury market.
With so many things in the pipeline, it would be interesting to see how things turn out for Ford and whether it can get in the race with General Motors and Volkswagen.
