Europe plays a key role in Ford Motor Co.'s plan to be a global powerhouse. Ford of Europe CEO Stephen Odell faces two challenges. Regionally, he must keep his European operation profitable despite a fading market. Globally, he must develop the right compact and subcompact models for Ford's different markets around the world. Those so-called B and C cars are expected to generate 55 percent of Ford's global output by 2020. Odell discussed those challenges with Automotive News Europe Chief Correspondent Luca Ciferri.
Looking to the European and U.S. versions, it is about 60 percent on the Fiesta and over 80 percent on the Focus. Part of this difference is that the new Fiesta started as a European product. During the development process, it was also adapted to the technical needs of the U.S. market. Meanwhile, the new Focus was a global project from day one.
You cannot develop a global car in splendid isolation in your own region. We interface with Dearborn (Ford's global headquarters) and with the satellite technical center in China for the B and C cars that would also be sold there. At the same time, we are part of the process carried on by Dearborn to develop the future Mondeo. The advance of technology is that today you can run global projects in teleconference, without the need to fly people around.
This decision is part of the realignment of our European manufacturing footprint that now calls for architecture-dedicated plants. The next Kuga perfectly fits Valencia. Together with the Saarlouis plant in Germany, it will be dedicated to C cars. Thus it can also manufacture the Focus, C-Max and the next Transit Connect. The Genk plant in Belgium remains the home of the Mondeo, S-Max and Galaxy. Ford's Otosan plant in Kocaeli, Turkey, continues to build the large Transit vans. Cologne will continue building the Fiesta, while the plant we are refurbishing in Craiova, Romania, will make the other B products.
Right now, the B-Max is intended mainly for western and eastern Europe. We are continuously looking for opportunities in South America, China and the U.S., but nothing is on our radar screen.
I have been to Las Vegas 25 times and I never, ever bet. What I can tell you is this: It would be a fantastic B vehicle!
We continuously look at the gaps in our cycle plan. Nevertheless, there will always be gaps, because you have to prioritize your spending. I think we have done exactly the right thing getting the core products for the market.
Absolutely. I do not see us selling many Ford F-150 or F-250 (large pickups) in Europe. There is no hard rule that every single new car has to be global. For example, although the B cars for Europe and India look the same, they have a significantly different level of technical content.
If you ask Sergio (Marchionne), I think he would say we are both happy with the product and that this is a good relationship we are happy to continue. Ford doesn't have an A platform and it has always been hard to make money on minicars.
The replacement is too far off to discuss.
This year, the industry had a run rate of about 15.9 million units in the first quarter and 14.9 million in the second quarter. The market is tailing off, and it's highly likely the yearly total will be below 2010. We are seeing not only Greece and Portugal, but also Italy, France, Spain and UK slowing down under the combined impact of sovereign debt concerns and austerity packages.
The German economy has come out of recession far quicker than most other Western nations, primarily spurred by its strong manufacturing industry and exports. It is really hard to judge how the positive factors could balance with the negative ones.