Ford Projecting 50 Percent Sales Increase in 4 Years
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Rejuvenated Ford Motor Company (NYSE:F) has bold predictions for the next four years, CEO Alan Mulally told USA Today. The once-again profitable company seeks to expand sales by 50% in just four years, heavily relying on expansion in the Asian and African markets. Ford sold 5.31 million vehicles in all markets for 2010. Mulally says the company seeks to increase that number to “nearly 8 million” by 2015.
The Chinese auto market is of particular interest to Ford. China has now surpassed the United States as the world’s largest market for new vehicle sales. Ford’s Chinese numbers are good, but not nearly those put up by rival GM. General Motors’ Chinese divisions have sold 1.08 million cars this year, compared with 230,068 for Ford as of June 7.
Sales expansion success will hinge on small car models, especially the Ford Fiesta, Ford Focus and Indian-built Ford Figo (shown below).
Heavy reliance on small car sales means lower profit margins on each model, but the company is confident that ramped-up production will lead to better economies of scale. By creating global model platforms, Ford has saved heavily on development costs. To be successful in its four-year plan, Ford will have to fend off heavy globalization efforts by GM, Hyundai/Kia and VW.