Overall sales in Europe may be down, but there’s still good news to report.
At least, that’s what Ford Motor Company (NYSE:F) said on Monday. Once again, the Blue Oval reported a year-over-year drop in overall sales in the 19 markets that it counts as “Europe,” down 2.2% in May.
That doesn’t sound good, but it compares well with the overall market’s 6.2% decline. That gap indicates that Ford Motor Company (NYSE:F) is gaining market share despite the grim overall environment.
That’s the good news Ford Motor Company (NYSE:F) wants to emphasize right now. And while there’s certainly a PR desire to put the best face possible on a difficult situation, it might actually be something for Ford shareholders to cheer.
Gaining share in a tough overall market
Ford said that its “total vehicle share” in Europe — meaning its market share including commercial vehicles — grew to 8.3% in May, up from 8% a year ago. Ford Motor Company (NYSE:F) also said that May saw its highest retail market share in Europe, 8.7%, since the company started tracking that number separately in 2010.
From Ford’s perspective, that’s a good story because it tracks the company’s priorities right now. To help understand why, here’s a bit of background.
Ford Motor Company (NYSE:F), like most of the other automakers doing business in Europe, has been hammered by very difficult economic conditions that have pushed overall new-vehicle sales down to levels not seen in about 20 years.
Ford, like General Motors Company (NYSE:GM) and other rivals, has lost a ton of money in Europe recently — more than $1.7 million last year and $462 million in the first quarter of 2013. It expects to lose about $2 billion this year, and most experts expect industrywide sales to stay depressed for a while.
Clearly, that’s a massive drag on earnings — and last fall, Ford announced a comprehensive plan to turn that around.
That plan involves some of the things you’d expect, like factory closings and staff cuts. But it also includes several strategies to help Ford make the most of the sales it is getting.
Ford Motor Company (NYSE:F) is introducing a bunch of new-to-Europe models from its global product portfolio, hoping to capture more sales in market segments it hasn’t previously contested in the region. It’s also cutting back on less profitable fleet sales, focusing on the retail market — and doing so with as few discounts as possible.