September 10, 2012
How Ford is tackling the Euro Zone crisis 0
Ford is losing money in Europe. In effect it is proving to be a major disadvantage in their battle with General Motors in Europe. The Euro Zone crisis is affecting the largest named car makers in the world. The simple truth is that there are more cars being produced than there are customers who are willing to buy them. The likes of Vauxhall, Peugeot and Renault are struggling a great deal. Plant closures and job losses are very realistic prospects in the near future.
For the first half the year, Ford’s business in Europe has dropped by 10 per cent. That represents the company’s worst performance for 17 years.
It is strangely a different story for South Korean companies Hyundai and Kia. Both companies recorded a rise in sales of 12 per cent and 25 per cent respectively for the first half of the year.
Ford will attempt to battle against the struggle with more fuel efficient vehicles. Already their vehicles are very well equipped in terms of economical technology. Ford are one of the best rated on the market when it comes to the running costs of their vehicles. They are now planning on pushing that forward even more. Part of that plan is to introduce technology that can allow drivers to monitor their power consumption and drive a lot more efficiently.
The EcoBoost engine is central to the company’s plans. It is already a major success throughout many emerging car markets. It’s a special engine as it can produce a great deal of power for it’s capacity whilst being extremely economical at the same time. Ford will also work on their standard petrol and diesel engines, helping to make them more fuel efficient.
Hybrid and electric vehicles are also on the agenda. Plenty of investment and research has gone into those areas with the car industry slowly trending away from conventional petrol and diesel powered cars. Ford themselves are so confident in them that they believe by the year 2020 electric and hybrid cars will account for 1 in every 4 sales. Alan Mullaly has stated that fuel efficiency technology is central is the company’s plans for the future.
For everyone to understand just how bad Ford’s operations in Europe are at the moment, they are set to lose £630 million this year alone. There clearly needs to be a more effective strategy than just concentrating of fuel technology.