Ms Puckrik, thanks for the debate. We’ll see the long term implications of their discounting. Relative to the mothership, they are doing quite fine indeed.

FWIW, one way that Toyota gained market share so rapidly in the States is with the same gimmicky advertising, similarly mouth-watering incentives, and high pressure sales tactics of its American counterparts. That’s the name of the game, I can’t find a way around it.

More to the point: if the converse was true, Saturn would rule the market. :)

Volkswagen Passat,
Honda Accord,
Hyundai Sonata,
Toyota Camry,
Toyota Prius (yes, it falls into this category),
Nissan Altima,
Mercedes-Benz C Class,
Ford Taurus,
Jaguar X-Type (Superb car!),
Volvo S40 AND S60,
Mazda 6 (Closest match to a Euro Focus)
Lexus IS,
Chevrolet Malibu (if you can find one),
Saturn Aura,
Chrysler Sebring (Sorry! Killing myself laughing!)
SAAB 9-3,
Buick LaCrosse,
Mitsubishi Lancer and Galant,
BMW 3 series,
Audi A4,
Lincoln MXZ,
Mecury Milan, Sable AND Grand Marquis.

You’ve got loads to choose from! In fact, I wouldn’t mind a drive in the Cevrolet Malibu. It looks rather nice……

Incidentally, I was looking at the Mitsubishi website and there was a sports car called the “Mitsubishi Eclipse” and the tag line was:

“you’ve practically lost your licence just looking at it!” Made me chuckle!

Boy, I would love it if America had that many real choices in the family sedan market.

That’s true in the United States and Canada, not necessarily the case in Europe. Americans have a Costco approach to buying retail products (buy it cheap and big); Europeans, not so much. Small cars in Europe don’t have the econobox stigma that they carry in the US, and retail prices for them in Europe are far higher, even excluding VAT. There is also substantial demand for mid-sized sedans in Europe generated by the corporate fleet market, as company cars are a fairly common perk for middle managers in European companies, unlike US companies that provide company vehicles to relatively few people.

Another reason why it’s doing ok in the UK is that overthere there aren’t as much choices as in the US.

Mr. Reinhardt beat me to it, but if anything, Western Europeans have more choices than do Americans in this class of vehicle.

Thank you for clarifying. It’s a bad way of doing business, but that’s Ford’s decision!

Ford Mondeo
Volkswagen Passat
Audi A4
BMW 3-series
Mercedes C-Class
Skoda Octavia
Saab 9-3
Volvo S60
Peugeot 407
Citroen C5
Renault Laguna
Fiat Croma
Lancia Lybra
Alfa Romeo 159
Jaguar X-Type
Cadillac BLS
Chrysler Sebring
Dodge Avenger
Chevrolet Epica
Hyundai Sonata
Kia Magentis
Toyota Avensis
Mazda 6
Nissan Primera
Lexus IS

With this apparent lack of choice, it’s obvious we just have to buy Mondeos.

Katie, it is my understanding that Ford long ago merged its British and German subsidiaries into one unit – Ford of Europe.

The key question isn’t the profit breakdown by country. It is profit breakdown by subsidiary.

When Ford of Europe reports results, it is for all of Europe – both the continent and Great Britain. If Ford is selling cars at a loss in, say, Germany, but at a profit in other areas, and said profits are enough to enable Ford of Europe to write its ledgers in black ink, that is good enough.

Ah yes, the tried and true approach.

If Ford UK are generating healthy profits and can sell these cars at discounts, good on them. Well done!

But everytime someone mentions Ford in Europe’s profits they always say “Ford EUROPE are making healthy profits”. Well, that as may be, but that is ALL of Europe, not just the UK. For all I know, Ford could be selling all their cars at RRP in every other country, bar the UK. Which is where they are generating profits, but in the UK, they are making losses?

To put it more succinctly, what’s the profit breakdown, country by country?

Discounts are the nature of the game, Katie. Come on now, you know the drill for entry-level to moderately priced vehicles. Value is king: many buyers demand a good deal (or the perception thereof) in order to sign on the dotted line.

And if Ford Europe makes consistent profits with discounts, they play the game right and should be complimented for this.

Am I missing something?

Do you have figures to back up that statement? Just curious, because I have always heard the opposite.

Note that here in the U.S., European manufacturers have mostly moved up the price scale because they don’t compete too well in the “mass” market. The only real exception is VW, and it imports a fair number of models from Mexico, and the prices of VWs tend to be higher than domestic and Japanese competitors. And VW still isn’t doing too well in the U.S.

With respect, What are you talking about? You say that Ford Europe made excellent profits. Great! Well done, to Ford Europe! But you (conviently) missed my point which was “how much of those profits were generated in the UK considering the heavy discounts you can get?”.

Remember, the article only talks about sales figures in the UK, not europe. Just like it’s unfair to say Ford is floundering in North America, when it is generating record profits in other markets, it is unfair to say the Ford Europe is making loads of profits, if none or little of the profits are coming from the UK.

As for PAG, I was just proffering a possiblity, not a fact.

Ford may have made a profit in Europe, but that doesn’t address how much they made on sales in the UK. They might have made the majority of profit in other countries (or possibly through PAG).

KatiePuckrik,

Ford of Europe made excellent profits (as they have done now for the last consecutive 6 quarters) based off excellent product, outstanding capacity utilisation rates and cost reductions that have reaped huge rewards. They should be praised by all for their hard work, but instead you wish to criticise the company, products and the plan.

For info by the way, PAG made a small loss ($97 million) so you can’t even point to them to support your erroneous theory. Face facts – Ford, in Europe at least, is a success and we should be grateful for small mercies!

Ford may have made a profit in Europe, but that doesn’t address how much they made on sales in the UK. They might have made the majority of profit in other countries (or possibly through PAG).

The real question is why aren’t they selling them as Fords?

“I just don’t get Americans’ fascination with Euro Fords. You can have them!”

No we can’t. Ford thinks we are not good enough for them.

ever since i saw the mondeo in the last James Bond movie, I thought it should be brought stateside pronto. I remember a few months ago that someone asked Alan Mullally why it wasn’t coming here and he responded something along the lines of “unfavorable exchange rates, different crash and emission standards, etc.”

Be reasonable now! You mean build a car people want and sell it at a profit? What a novel concept!

Well, most of Mullaly’s reasons why not makes one wonder how the European car makers get any cars sold in the US … ? I’d hoped for a better answer. :-)

I know it’ll never happen, so it still breaks my heart whenever we bring it up.

Mercury Rising?

Beats the hell out of me why won’t at least try selling the Ford XR6 and XR8 Utes in the US.

Huh? I guess that’s why the American automakers are doing so well…

While European car manufacturers have never reached the quality of Japanese vehicles, they are head and shoulder above their American counterparts when it comes to manufacturing efficiency, and that includes labor quality.

Well, they have already! It’s called the Volvo C30. It has the same chassis and engine as a Focus ST.

So, go drive one! :O)

Sometimes business strategy is complex and sophisticated, but most of the time, stunningly obvious.