Many market analysts agree that China has one of the largest auto markets in the world. What is even more interesting about this is the fact that a huge portion of this market is largely inaccessible to many foreign businesses. In an effort to tap this massive revenue potential, American car maker Ford recently announced that it is establishing a solid foundation in the Chinese market through "right leadership and right products."
In a statement during an industry conference in Detroit, Ford president for global markets Jim Farley said, "We are now beginning to see the results of our capital shift away from traditional sedans to trucks and SUVs with new utility nameplates globally, including China."
In order to establish the brand into the mainstream consciousness of the Chinese consumer market, Ford plans to roll out more than 10 new Ford and Lincoln products in China this year alone. The automaker also made a commitment to release more than 30 products in the Chinese market well within the next two years. Mr. Farley also highlighted the company's effort to improve its relationship with local partners as well as dealership networks.
Since July 2018, Ford has made urgent changes in its approach towards China's auto market. The company adopted new measures in order to address underperformance in China. Ford embraced these changes in a time when the company faced a huge decline in overall profit during the second quarter of last year.
In order to stay competitive in a very aggressive market, Ford adopted aggressive fitness actions in China. This was part of an effort to improve cost competitiveness. The company has also started to hire local individuals to sit on some of its top and important management positions.
Ford has also considered possible coordination with German carmaker Volkswagen in order to reduce expenses. According to reports, the two carmakers will launch this newly forged partnership in 2022.
Among the measures made by Ford in the Chinese market was to lower the price of some of its flagship line up of vehicles. Ford also lowered its full-year outlook in 2018 in an attempt to set a realistic benchmark. Ford said that it was able to close 2018 with adjusted earnings per share of $1.30. The company also declared $23.1 billion in cash and $34.2 billion in liquidity. The company is expected to formally report its full 2018 earnings result before the end of the month.
