Ford's China vehicle sales in February fall 30 percent year-on-year
Won't have new products for world's biggest car market until next year
Autoblog/REUTERS - Norihiko Shirouzu - Mar 9th 2018
...bigger factor behind the sales slump was what Fleet and other company officials have described as the dearth of new or significantly redesigned car models in its product pipeline, a situation that has weighed on the company's business at least since early 2017.
Ford does not expect new products to start hitting the market in China until the first quarter of next year...
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Ford overhauls China operations: 'Bear with us'
Detroit Free Press - Phoebe Wall Howard - Feb. 15, 2018 | Updated
Ford is resetting its China operations, moving some workers back to the U.S. and hiring Chinese citizens who speak Mandarin and firmly grasp the culture and market.
After reporting an 18% year-over-year dip in China sales last month, the Dearborn-based automaker is urging investors to keep the faith as the company makes big changes following the exit of Ford China CEO Jason Luo after just five months.
In an exclusive telephone interview with the Free Press, Peter Fleet, president of Ford Asia Pacific,
outlined specific product and staffing challenges and a plan designed to strengthen the company in the largest automotive market in the world.
“It’s going to be a little bit of a bumpy ride for Ford in China this year," he said. "The second half will improve. We have a very clear opportunity in front of us. Bear with us.”
Fleet acknowledged that the unexpected resignation of Luo, a longtime metro Detroit auto supplier executive who left for unexplained personal reasons, was a setback. Fleet said he is interviewing CEO China candidates and plans to make a hire by June...
...One major reason for Ford's sales dip in China is the fact that the company hasn’t released new products. The vehicle that will carry Ford into its new season will be unveiled at the Beijing Auto Show in mid-April.
Sales aren't scheduled to begin until fall 2018.
“That would be relevant in any market but it’s super relevant in China,” Fleet said, noting that many customers may be new to Ford, new to car ownership or seeking a special second car.
"The key is, they’re not replacing an existing car. They’re likely looking for the newest, most exciting product. In China, you get a big uptick with a new product. And if you don’t have new product, you pay a little bit of a price for that.”
The Chinese news media spotlighted Ford in December 2017, when CEO Jim Hackett and Executive Chairman Bill Ford went to Shanghai to announce plans to build 50 new products in China by 2025 that include utility and electric vehicles tailored for Chinese customers. Building overseas keeps prices low and increases profit margin.
In preparation for upcoming launches, Fleet said he will reduce by 30% the company’s 500 or so “international service employees” in China. Ford generally rotates its staff for three-year stints in operations overseas. At this point, Ford is looking to replace a portion of its employees from the U.S. and other countries in sales and executive positions in China with Mandarin-speaking locals.
“We want to reflect the market,” said Fleet, who is originally from the UK. “Ford has always had local nationals leading the business in various parts of the world, and China should be no different. We’ve made huge investments to turbocharge our start in Chinese business. We brought in global leaders to run that business. Now as the business matures, we’re getting many more Chinese and Chinese-born leaders in positions of authority in the company.”...
...Today, Ford is aggressively working to recruit Chinese candidates for all levels of the company, Fleet said.
Finally, but significantly, Ford is hoping for regulatory approval in late 2018 on its small battery electric vehicles being built with joint venture partner Zotye
“We will start to assemble the first of our new products. We’re doing a lot of restructuring of our business in China,” Fleet said. “Perhaps the most significant is establishment of the national distribution. We’re changing our sales and marketing plan. Whereas today we have three or four different approaches to the market, depending on which joint venture builds the product or whether it’s imported, in the future we’ll have one distribution channel.”
Ford points to an overall strong business in China, where consumers bought nearly 1.2 million vehicles in 2017.
“I know sales are off a little bit for reasons we described,” Fleet said. "This is a business that’s already established in scale. We’re in a cycle where we can’t grow our sales right now. But very shortly, we’ll start to grow the business again. We expect that to start happening during the second half of the year.”
Wall Street was disappointed to see Ford report the 18% drop in Chinese sales in January. That followed news that for all of 2017, sales in China dipped 6% from 2016.
For comparison, General Motors reports consistent growth in China. GM headlined a financial report with "GM China Sales Top 4 Million Vehicles for First Time in 2017."
“The Chinese market is now the largest in the world both in terms of vehicle volume and the total value of vehicles sold, and growth continues to outpace other global regions," said Kristin Dziczek, director of the Industry, Labor & Economics Group at the Center for Automotive Research in Ann Arbor. "Posting losses in China while the market is growing and everyone else is gaining sales is a very bad sign, and something Ford needs to turn around, and quick.”
Consumers purchased nearly 28.9 million vehicles in China in 2017, compared with about 17.2 million in the U.S.
“General Motors and Volkswagen were early movers in China, giving them some serious advantages over Ford,” said Dave Sullivan, product analysis manager at AutoPacific, Inc. “Ford needs to come up with what makes them unique in the market, just as the F-Series and commercial vehicles have been Ford's stronghold in the U.S.”
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Now I remember where I heard about Zotye before...
While China's Zotye has made a (bad) name for itself in Western press for ripping off designs like its Porsche Macan (SR8), Lambo Urus Concept and Audi Q3 clones, they also produce more original cars like the E200, a two-seater EV.
CarScoops/2017/09/Zotye E200 Electric Mini Car Spotted On Chinese StreetsAnd this is who Ford decided to get in bed with?? They already got caught cheating 3 times.