Ford's Europe sales rise 12.5% in first quarter

Michael Martinez
The Detroit News

Led by Ford Motor Co., auto sales in Europe — long a trouble spot for American carmakers — are showing signs of a turnaround.

As the recovering economy put more money in the pockets of Europeans, Ford sales in Europe rose 12.5 percent during the first three months of 2015. The Dearborn-based automaker gained market share against its rivals and became the No. 1 vehicle brand, thanks to a wave of new products.

Its crosstown rival General Motors Co. reports sales of its Opel brand rose 3.1 percent during the first quarter — although when combined with Chevrolet, the numbers are down. GM has decided to pull most of its Chevy vehicles out of Europe.

Fiat Chrysler Automobiles NV has not yet released its sales for the full first quarter. But sales for January and February were up 8.6 percent.

"It does seem like the domestics are relatively well-positioned," said Karl Brauer, senior analyst with Kelley Blue Book. "For Ford in particular, I feel like this is the fruits of a long-term labor."

Ford sold 335,089 vehicles in Europe during the first three months of 2015 and reported a 14.4 percent sales bump in March. Its market share rose 0.2 percentage points in the first quarter to 8.2 percent. Ford recently surpassed Volkswagen as the best-selling vehicle brand. In 2012, Ford ranked No. 7.

Ford is in the midst of a transformation in Europe that's included cutting jobs and closing plants in an effort to turn a profit in that region.

"This is really about momentum for us," said Peter Fleet, vice president of sales for Ford of Europe, said on a Tuesday conference call with reporters. "The new products we're bringing to market aren't just adding additional sales numbers; it highlights favorability in the brand."

Ford's success in Europe was helped, in part, by GM's decision to mostly pull out of economically troubled Russia. Fleet said Ford has seen an uptick in interest there from GM customers and dealers.

"We certainly see upside to our operations in Russian from the GM announcement," he said. "We've had some significant expressions of interest from GM dealers in Russia who would like to be represented by Ford, and some customers from GM coming to us. Not thousands of customers desperately trying to sell their cars, but seeking some assurance the Ford dealer is able to service their GM car."

Fleet said that despite the challenges in Russia, Ford was "picking up some momentum" there thanks to new products and government loan packages that are designed to boost sales.

Across Europe, Fleet said Ford's gains have been driven by its new products. Half of the automaker's sales volume comes from new or refreshed vehicles, and Ford is offering more expensive option packages on its larger cars.

In addition to being moneymakers, premium packages boost mass-market carmakers like Ford against rival offerings from upscale companies such as Mercedes-Benz, Audi and BMW. In return, those luxury automakers are offering more vehicles in the small and mid-priced segments.

Sales of the all-new Mondeo were up 34 percent year-over-year and customer orders were up 75 percent.

Ford's SUV sales were paced by the Kuga, which got one of the upscale trimline options, up 30.7 percent. It was the best first quarter since 2008, when the first-generation Kuga was launched. Sales of the EcoSport compact SUV also continued to gain momentum in first quarter sales with nearly 9,700 sold.

"Whatever way you cut it, it's very clear there's some strong industry growth in Europe," Fleet said.

"The momentum we've enjoyed in the first quarter ... we are expecting to continue to drive that momentum forward for the rest of the year."

Fleet wouldn't comment whether better sales will translate into profitability in Europe. Ford has forecast it will lose more than $250 million there this year. It will release first quarter earnings at the end of April.

"They're gobbling up market share and increasing sales, so in the long term they're positioned well to be very profitable," Brauer said.

Ford lost $1.1 billion before taxes in Europe last year, including $443 million in the fourth quarter. First-quarter earnings are due April 28.

mmartinez@detroitnews.com

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Associated Press contributed.