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Ford revs up for another year of robust growth

Monday, Feb 13, 2012

Gulf News

Dubai: Ford stepped up a gear in the Gulf last year. Or should that be a couple of gears?

How else can one explain the 50 per cent volume growth — and nearly 65,000 units — the carmaker sold during the year when most others would have been quite content with 5-10 per cent in what was a roller-coaster environment for the sector?

Attribute it to the expanded model range in the small- and mid-sized categories, which Ford had assiduously been working on for some time. There were also encouraging signs that the Lincoln marque was gaining traction in the region’s premium car category.

All of this makes Larry Prein, the Middle East managing director, contented. But will Ford, and Prein, be able to do a repeat this year?

Gulf News: As far as the model line-up is concerned, is it more or less a settled picture for Ford in 2012?

Larry Prein: We introduced a few models in the Middle East over the past couple of years and we think this is the strongest line-up Ford has ever had. But we are not done with the new introductions yet.

This year we still have the next-generation Ford Ranger pick-up coming up, we are launching the six-cylinder F-150, and we have a refreshed Taurus coming up with a new front and back end. It’s a change, not a brand new car. That will be in by June.

But right now we are in the middle of launching the brand new Ford Focus. It has done exceptionally well in Europe, always done well in the UAE and the initial shipment of the latest generation has already sold out.

It hasn’t stayed long in the showroom. The UAE is currently the strongest market for the Focus, which is starting here at Dh59,900. We thought it would fly off the shelves and it did.

They used to sell a lot of Focuses, but it came down in the last couple of years being at the end of its model life and it was up against more updated competitors. Right now we are at the beginning of a [new] model life and the exchange rates are much better than they were. [The Focus is being shipped in from a plant in Germany.]

Is Ford getting the same level of buyer interest for its premium range (excluding Lincoln)?

In the past year the Taurus has done very well. We have never really sold a large car in the UAE before. The new Explorer is a phenomenal hit and we can’t get enough. In 2013, there will be the new Mustang Shelby with 650 horsepower and there’s going to be the Edge Sport. At the top end, Ford is putting more technology pretty much in line with any main-line manufacturer. Quality has been very good.

Retail sales make up more than 60 per cent of your regional volumes. Do you feel there’s a need to do more on getting the fleet sales up?

Right now retail demand is very strong and so we want to take care of that first. Fleet is around 35 per cent based on the latest figures; I am not worried about it [as] what I am trying to do is grow our total sales by finding the customers and the niches to fit in.

In 2011, Saudi Arabia and the UAE provided the stellar returns for Ford. But some of the other carmakers are getting some nice numbers from Iraq and the Kurdish areas. Where do you stand vis-à-vis these markets?

Frankly, we got a bit of a late start; opened in 2008 in the Kurdish area. Now we are working hard to expand our footprint throughout Iraq.

There’s immense potential, but safety, security and stability are really the big questions on how fast things will develop.

A lot of cars have been brought in from Levant and a lot of different areas and you can find Ford cars in Baghdad and other places. We want to make sure we have the customer service facilities to go with those. We can support the cars and customers in the way it’s done elsewhere.

Late last year, Ford commissioned the Parts Distribution Centre in Jebel Ali. Did the company really need to make this commitment?

This way we are allowing your dealers to hold a wider range of parts but not with quite as much depth. For that we have the Parts Distribution Centre. This way, they can service customer needs very quickly and with more ability.

We will be rolling out the sub-Saharan and African dealers (into the PDC) probably in the second quarter of this year.

Would another 50 per cent sales growth this year be too much to ask for?

We are probably looking at more around 15 per cent and I will take that. Around the world Ford models are popular and it depends on how many vehicles we can get and how many we can sell.

For instance, we are working with Ford Europe to pick up more production on the Focus.

Al Tayer Motors had an all-time, any-month record sale in January, which is unusual since January is usually a little bit slow. They did even better than in 2008. There was a strong start in Saudi Arabia, but not in record-breaking territory.

Everything is coming together for Ford.

Lincoln gains traction

Lincoln is setting itself up to be among the prime options available for the region’s luxury car buyers. And Larry Prein is laying the groundwork to get there.

“We started seeing traction [for the Lincoln] since 2010 when we started making the brand more relevant through newer products such as the MKX and MKT,” said Prein.

Last year, Lincoln sales made up around 3 per cent of Ford’s overall sales in the region.

“The new-generation of Lincoln models will increase the attention,” said Prein. “But we want to work towards sustainable volumes; we have seen some competitors come in with very low prices or financing deals that could not be sustained.

“Trying to rebuild a brand like the Lincoln, which is what we are trying to do, is not something that will be achieved in one or three years. It takes five to seven years for all the products to roll out and for customers to understand what is happening.”

The new Lincoln MKZ is set to hit the regional showrooms late this year and that should provide further ballast. “This year we will also be working with our dealerships on how to differentiate Lincoln from Ford,” Prein said.

“We haven’t spent a lot of money in the past few years [on building the Lincoln identity]. That will change at the end of the year and early next as we bring in the next-generation of vehicles.”

By Manoj Nair, Associate Editor

© Gulf News 2012. All rights reserved.