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Ford's US giant redirects spending in Europe from cars to SUVs, crossovers and commercial vehicles that are more profitable in an attempt to rebuild operations in the region, according to Auto Week and Automotive News Europe. 19659002] Affected by Brexit and consumer preference for SUVs and crossovers, Ford's operations in Europe recorded first-half pretax losses of $ 73 million, compared to $ 88 million in profits Last year
In announcing Ford Financial Results, Managing Director Jim Hackett said: "We are extremely dissatisfied with our performance in Europe."
This year, the American company expects to report losses in the region after 234 million dollars in 2017, writes Agerpres.
Bob Shanks CFO Bob Shanks says most Ford of Europe vehicles are not profitable
The Kuga crossover, Transit and Ranger vans and "some imported vehicles" are profitable in Europe, said Shanks without naming the imported cars. The Edge Crossover and the Mustang Sports Model could also be on the European Market
Shanks explained that vehicles account for more than 200% of Ford's profits in Europe, although it accounts for less than half of the revenues
Jim Farley, According to Ford, commercial vehicles are responsible for 13% of the company's profit margins in Europe.
Ford Will Change Strategy and Focus on SUVs, Crossovers and Commercial Vehicles To achieve its goal of achieving a 6% profit margin in the region, Farley said: "We certainly need to A major shift in the European market, we will focus on profitable operations in the light commercial LVC segment.) SUVs are part of this plan, said Farley.
Ford is currently selling three crossovers in Europe : EcoSport, Kuga and Edge: In the second quarter of 2018, Kuga and EcoSport shipments to the European market reached record levels, the US company reported.
The C-Max Compact Van underperformance in Europe, which could prevent model production in the region
In the first half of this year C-Max supplies decreased by 18% to 31 888 units, shows data from JATO Dynamics [1 9659003] In addition to focusing on SUVs and light commercial vehicles, Ford plans to continue "aggressive" cost reductions and launch new products in Europe more quickly
In June, the company announced that she would close the gearbox factory in Blanquefort (Bordeaux, southwestern France) if he can not find a buyer.
Bob Shanks says Ford will rely more on partnerships to turn its European business around. "It's important to recognize that partnerships are already an integral part of our operations in Europe and we expect in the future that they play an even bigger role," said Ford's chief financial officer.
Ford has a long-term partnership in the field of engineers with the French car manufacturer PSA
In June, he signed an agreement with the German Volkswagen AG for a potential alliance in the segment of commercial vehicles and from other projects
Ford has revised its earnings estimates this year the cause of the decline in sales, China's tariffs, the difficulties it faces in the European market, and warned that he could see costs of 11 billion business dollars over the next five years
25% for steel imports and 10% for aluminum imports, entered in force l March 23 and from June 1 are also applied to EU producers. These prices could cost Ford about $ 1.6 billion this year in North America, said Bob Shanks, the company's chief financial officer.
Ford shares fell 3.7% Wednesday on the New York Stock Exchange
"It is clear that there will be a major and deep restructuring that will really solve the business areas the weaker, "said Bob Shanks. He added that Ford will improve the performance of these sectors or sell them.
In the second quarter of 2018, Ford's net profit fell by nearly 50%, according to analysts, due to a fire at a component supplier caused disruption in the production of popular vans, while that sales are declining and that tariffs are affecting China's performance. In the first five months of 2018, Ford's sales in the world's largest auto market dropped by 22 percent, and between April and June 2018, Ford's operations in China dropped by $ 483 million
Ford announced that it was working to reduce the costs of its subsidiary in Europe, focusing on profitable models and significant restructuring operations.
This year, Ford would record adjusted earnings of $ 1.30 to $ 1.50 per security. , compared to previous forecasts of $ 1.45 to $ 1.70 per share, while analysts expect $ 1.52.
In the second quarter of 2018, Ford's net income fell to $ 1.07 billion, or $ 0.27 per capita, compared to $ 2.05 billion or $ 0.51 per share for the same period last year. 2017. Analysts were expecting earnings of $ 0.31 per head between April and June 2018. [19659004] In April, Ford announced the acceleration of the cost reduction plan and announced it. Increased profit margins, including the renunciation of traditional North American sedan models that are no longer popular among customers
The company now plans, by 2022, and cuts costs by 25.5 billion dollars, compared to $ 14 billion in the fall announced.
Ford General Manager Jim Hackett told investors that the company was undergoing a "refocusing" "We will proceed with the necessary restructuring and take decisive action. We will allocate money to the healthy part of our business and we will abandon marginal operations, "said Hackett.
Ford expects a global profit margin of 8% by 2020 and about 10% in North America
Ford Motor, the second largest automaker in the US United, has about 197,000 employees and 67 plants worldwide
The Ford subsidiary in Romania confirmed in May that it will manufacture a second model at the Craiova plant. "The new model will add to the production of the current generation of the small class Ford EcoSport SUV and the EcoBoost 1.0 engine." Ford also invests up to 200 million euros in Craiova, the total investment started in 2008, reaching nearly 1.5 billion euros, "said Ford Romania.
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