Steve Armstrong rose to the top job at Ford of Europe last June in the reshuffle that followed the ousting of Ford Motor CEO Mark Fields. Armstrong inherited a profitable division that was in danger of falling back into the red because of the Brexit vote in the UK, Ford's biggest European market. The British executive gained experience dealing with market upheaval in his previous role as head of Ford South America. Now he has to show that Ford can be consistently profitable in Europe. He spoke to Automotive News Europe Correspondent Nick Gibbs.
How committed is Ford to Europe?
We're very committed, as shown by the actions taken by the team over the last few years to strengthen our business. We are committed and we plan to stay.
Last year you saw profits fall after a good 2016. What is your outlook for Europe in 2018?
We expect 2018 to be more profitable than 2017. That will be underpinned by the first full year of the new Fiesta and the new EcoSport, which we have just localized in Craiova, [Romania]. Later in the year, we have the new Focus coming. By the end of 2018, we will have renewed about 80 percent of our total vehicle range by sales volume [over two years].
You've said 6 percent is your margin target. When will you reach that?
I haven't published a date. For me it's about putting the business on to a trajectory that gets it to 6 percent in the future. After the challenges we had in 2017, we have to demonstrate that 6 percent is an achievable number. It's going to be some time into the future [before the target is reached].
Could a focus on SUVs see you reducing your passenger-car range?
We will focus our [budget] allocation on more profitable segments, but it depends where we are in the product cycle. The future of the Fiesta and Focus is secure. But it is clear customers are increasingly moving to crossover-type vehicles.
What is the future for the Mondeo midsize range in Europe?
We still have a great Mondeo business. In future cycles for the product we have the appropriate amount of investment to make sure that it stays competitive. This is also the case for the S-Max and Galaxy [minivans].