Ford made it clear how important SUVs are to the US market when it announced that almost all non-SUV models would be killed off. The US auto market is clearly SUV-obsessed, but Europe still buys plenty of sedans and hatchbacks. Now, the question is: will Ford make the same decision to focus on SUVs in Europe? Automotive News reports that Ford will have to give SUVs a higher priority if it wants to be profitable in Europe.
Ford CEO Jim Hackett made it very clear: “We’re extremely dissatisfied with our performance in Europe.” Due to a combination of Brexit and a consumer switch to crossovers, Ford’s European division quickly fell from $88 million in profit last year to a $73 million loss in the second half of 2018. Ford has several models that are losing money in Europe. Shanks did mention that some vehicles are selling profitably, including the Transit van, Kuga crossover, Ranger pickup and “selected imports” (most likely referring to the Mustang and Edge).
These vehicles represented over 200% of Ford’s profits in Europe while accounting for less than 50% of sales. Ford clearly needs to refocus its strategy in Europe, and will now concentrate on crossovers and vans. It’s not likely that the company will go so far as to cancel all non-SUVs, but Europe may soon suffer the same fate as the US when it comes to the dominance of crossovers.
