U.S. automaker Ford Motor Co. (F, Financial) reported October sales in China. Sales amounted to 105,809 units, down 5% on a year-over-year basis. Total sales for the January to October period came in at 938,570 units, which represents a 5% sales decline from the prior-year period. However, for Lincoln and Jiangling Motor Corp. (JMC), it was a record October for sales on a volume basis.
Source: Ford
By the numbers - JMC and Lincoln thrived
October sales for Changan Ford Automobile (CAF) were 73,551 units, down 11% from October 2016. Year-to-date sales also remained lower compared with the prior year. The company sold in excess of 640,000 units during the 10-month period, down 14%. JMC’s monthly sales amounted to more than 25,000 units (up 6% year over year), while its year-to-date sales totaled almost 237,000 units, up 15% compared to the year-ago quarter.
The Mondeo and Escort models saw immense sales growth in the Asian economy. While sales of the former surpassed 10,000 units during the month, sales of the latter improved 6% year over year to more than 29,000 units. On the other hand, sales of the Kuga and Everest SUVS spiked 11% and 38% respectively.
The "Blue Oval’s" imported vehicle sales climbed in October. The Mustang and Focus RS/ST saw mammoth double-digit sales growth from last year, up 93% and 71%.
Lincoln’s October sales were nothing short of a success. Lincoln sold more than 5,500 units, a 48% increase. Lincoln sedans saw a tremendous 180% sales growth during the month. The brand's SUV vehicles - MKC, MKX and Navigator - saw remarkable growth in October, up 3%, 12% and 56% respectively. Lincoln MKZ sales skyrocketed 55% on a year-over-year basis. Lincoln Continental sales stood at nearly 1,100 units.
Ford partners with Zotye Auto
The Dearborn, Michigan-based automaker has officially joined hands with Chinese electric vehicle giant Anhui Zotye Automobile Co. (SZSE:000980) to build electric cars in China. Both Ford and Zotye will own a 50% stake in the new joint venture, called Zotye Ford Automobile Co. Ltd. The $756 million deal is not a big surprise as the two have been planning to work together since August. Zotye apparently dominates the Chinese market for small electric vehicles. It sold more than 22,500 electric vehicles in China over the first 10 months of the year, up 14% from the prior-year quarter.
Zotye Ford will focus on building and developing a portfolio of elegant and reasonably priced electric vehicles for Chinese consumers. The American automaker announced earlier this year that more than two-thirds of its brand vehicles sold in China would offer electrified powertrain options by 2025. Peter Fleet, Ford group vice president and president of Ford Asia Pacific, commented:
“Subject to regulatory approval, Zotye Ford will introduce a new brand family of small all-electric vehicles," he said. We will be exploring innovative vehicle connectivity and mobility service solutions for a new generation of young city-dwelling Chinese customers."
The deal with Zotye will be the company’s third joint venture in China. The Chinese government has set some strict standards regarding fuel emissions and is determined to move into an environmentally friendly automotive world. It will be interesting to see whether Ford’s efforts to expand its footprint in China bears fruit or falls flat in these changing dynamics.
Disclosure: I do not hold any positions in the stock mentioned in this article.
