Ford Motor Co.
) has posted record sales of 549,256 vehicles in China in the first
half of 2014. This translates into a 35% surge from 407,474
vehicles sold in the first half of 2013. The automaker's passenger
car joint venture - Changan Ford Automobile (CAF) - also witnessed
a 39% increase in wholesale vehicle sales in the first half of 2014
to 397,958 units as against 286,433 units sold in the same period a
The year-over-year increase in sales was driven by strong demand
for Ford Focus, Ford Kuga, Ford Mondeo and Ford EcoSport. Sales
were also buoyed by favorable impacts from Ford's strategic
expansion in China capacity extension and recruitment of competent
employees, thereby creating a line of high quality, safe, fuel
efficient and high-tech products.
Ford's June sales in China increased 17% to 87,783 vehicles from
75,166 in the year-ago month. Meanwhile, CAF witnessed a 23%
increase in wholesale vehicle sales in the month to 67,187 units,
compared with 54,774 units in Jun 2013.
Ford Focus, which supported the improvement in CAF sales, recorded
a 9% year-over-year increase in sales to 201,464 units in the first
half of 2014. Also, Ford Focus sales in June improved 7% year over
year to 33,614 units.
Apart from Focus, Ford Mondeo also witnessed significant demand in
the country in the first half of this year. Mondeo passenger cars
offer sophistication and advanced technologies, raking in sales of
59,726 units in the first half of 2014, manifesting an astounding
rise of 124%. In addition, Mondeo sales rose a significant 168% to
10,044 vehicles in Jun 2014.
Ford also recorded better sales under its class-leading Ford Kuga
and Ford EcoSport SUVs. In the first half of 2014, Ford Kuga sales
went up 78% to 66,225 wholesales units while in the month of June,
Kuga sales improved 18% to 10,901 vehicles. In the first half of
2014, Ford EcoSport sales rose 103% and June sales grew 28%.
The slew of positives continues with imported vehicle sales
increasing 70% to 18,360 vehicles in the first half of 2014.
Notably, Ford China primarily imports vehicles under the Ford Focus
ST, the Ford Fiesta ST, the Ford Edge and the Ford Explorer brands.
Further, Ford's commercial outlet in China, Jiangling Motors
Corporation (JMC), sold 132,938 vehicles in the first half of 2014.
Sales surged 21% over 110,230 units in the same period year ago.
Moreover, June sales augmented 19% to 19,012 vehicles.
Ford is implementing aggressive growth plans in China. Last month,
the automaker opened a transmission plant in Chongqing for $350
million. This is the first transmission plant in the Asia-Pacific
region of the company and will produce 400,000 units per year. Last
month, Ford also launched 88 new dealerships across China which
brings the total dealership count to 750.
Ford's revenues in the first quarter of 2014 grew 0.8% to $35.9
billion on the back of market share gains in the Asia-Pacific
region, particularly China. The automaker's market share improved
to 4.5% in the nation, fueled by strong sales of Kuga, Mondeo and
Ford currently carries a Zacks Rank #3 (Hold).
Some better-ranked automobile stocks worth considering are
China Automotive Systems Inc.
Wabash National Corp.
). China Automotive and Wabash National sport a Zacks Rank #1
(Strong Buy) while BorgWarner carries a Zacks Rank #2 (Buy).
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FORD MOTOR CO (F): Free Stock Analysis Report
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