Ford Motor Company (NYSE:F) Is Currently Struggling In China
The Ford Motor Company (NYSE:F) has witnessed declining vehicle sales in China since the beginning of this year, which has made it fall way behind its main competitors. The automobile manufacturer must address this trend immediately given that recent statistics indicate that China is the largest automobile market in the world having overtaken the US.
Some of the factors that have contributed to Ford’s struggles include the fact that it has not launched any new models that are tailored to meet the needs of Chinese consumers. This is extremely important given that the Chinese market is quite different from the European and US markets.
The company also faces stiff competition from other multinational automakers such as General Motors Company (NYSE:GM) as well as competition from local car manufacturers. Local Chinese car manufacturers are constantly launching new models targeted at addressing the needs of Chinese consumers, while at the same time slashing prices in order to attract customers.
Ford has not released any new car offering since 2013 when it released the current model of the Focus and the Escort, which has contributed significantly to Ford’s declining sales. Ford has witnessed double-digit declines in its recent sales, while GM reported a 12% increase in sales during August after launching several crossover SUVs developed specifically for the Chinese market.
Earlier this year, Ford fired its former CEO Mark Fields and appointed Jim Hackett who was given the mandate to turnaround the company. Ford must invest more resources into developing electric cars as more consumers prefer to buy electric vehicles, as opposed to Ford’s flagship gasoline vehicles such as the F-150.
The company is reacting quite slowly to changing consumer trends, which might lead to its downfall even as its main North American market is undergoing a major transformation.
Currently, Ford does not have the capacity to compete effectively in the electric car category, which spells trouble for the company’s future even as its competitors such as Tesla Inc (NASDAQ:TSLA) make huge investments in electric vehicle production.
The question remains whether there is hope for a major turnaround at Ford or whether the company is headed for a massive downfall.
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