Ford watching Russia for slow growth after sanctions
Ford began full production of the Explorer at its plant in Yelabuga, Russia, in April 2013.
Photo credit: BLOOMBERG
DETROIT (Bloomberg) -- Ford Motor Co., which has three auto factories in Russia, is monitoring the sanctions against that nation for its involvement in Ukraine and hasn't yet seen an impact on its business, the automaker's No. 2 executive said.
"Some new sanctions were announced yesterday and we're trying to understand what those are," Mark Fields, Ford's chief operating officer, told reporters on Friday. "At this point, we don't believe it's going to hurt our business. The issue we've been looking at is the overall health of the economy in Russia right now with the ruble weakening."
President Barack Obama has imposed financial sanctions on Russian officials and billionaires close to President Vladimir Putin.
Ford still expects Russia to grow and become Europe's largest auto market, though that could be slowed by its weakening economy, Fields said.
Ford has increased its model offerings in Russia from two products in 2011 to seven now, with an eighth coming soon, Fields said. "We just hope the situation there calms down and it ends peacefully."
Ford has a 3.6 percent market share in Russia. Its Russian sales in the first two months were down 21 percent to 13,514 compared with the same period in 2013, the Moscow-based Association of European Business said in a statement on March 11.
Fields, 53, was tapped to become Ford's No. 2 executive in December 2012 after leading the automaker's North American operations from deep losses to record profits. The promotion put Fields in the lead position to replace CEO Alan Mulally, 68, who has said he will remain at Ford through the end of this year.
Mulally is credited with cultivating a more collaborative culture at Ford, which had long been characterized by backbiting.
Fields, a 24-year veteran of the company, was among the first executives to switch to the more cooperative style Mulally introduced when he arrived from Boeing Co. in 2006. Ford managed to avoid the bailouts and bankruptcies that befell the predecessors of General Motors and Chrysler Group.
Ford has earned $42.3 billion in the last five years after losing $30.1 billion from 2006 through 2008. Last year, surging sales of Escape SUVs, F-Series pickups and Fusion sedans helped drive Ford's pretax earnings in North America to a record $8.78 billion.
Automotive News Europe contributed to this reportContact Automotive News