Ford Sollers, the 50/50 joint venture between
Ford Motor Co.
) and Russian automaker Sollers, plans to manufacture EcoSport
sports utility vehicle (SUV) in Russia next year in order to meet
the growing demand for SUVs in the country. The joint venture
will produce the vehicle at one of their two plants in Tatarstan
during the second half of 2014.
FORD MOTOR CO (F): Free Stock Analysis Report
FEDERAL MOGUL-A (FDML): Free Stock Analysis
GENERAL MOTORS (GM): Free Stock Analysis
TOWER INTL INC (TOWR): Free Stock Analysis
To read this article on Zacks.com click here.
According to Ted Cannis, head of the Ford Sollers, manufacturing
SUVs offer a big opportunity for the joint venture in the Russian
market. So far, automakers in Russia import SUVs from abroad
pushing up their prices. However, Ford Sollers plan to market the
EcoSport at a lower price.
Recently, Ford Sollers broke ground on a $274 million powertrain
plant, located in Elabuga in the Russian republic of Tatarstan.
The plant, which is expected to employ 500 workers, will
manufacture three different versions of the 1.6 liter Duratec
engine from December 2015.
The plant will have a capacity of up to 105,000 engines per year,
which may be expanded to 200,000 engines per year. At least 30%
of Ford vehicles built in Russia is expected to be equipped with
Ford began selling cars in Russia from 2002. Its expansion plan
in the country is perfectly in line with its strategy to expand
global sales by 50% to 8 million vehicles by 2015, given the
potential growth in Asia. Sollers is the leading automaker in
Russia after AutoVAZ.
The joint venture between Ford and Sollers was formed in 2011. It
already operates a vehicle assembly plant in Naberezhnye Chelny
in Tatarstan and another in Vsevolozhsk near St. Petersburg. So
far, the joint venture manufactures Focus, Mondeo, Galaxy, S-MAX,
Transit, Kuga and Explorer vehicles in these plants.
Ford, a Zacks Rank #3 (Hold) stock, posted an increase of 4.1% in
earnings to $1.6 billion and 5.1% in earnings per share to 41
cents in the first quarter of 2013, beating the Zacks Consensus
Estimate by 3 cents. Revenues improved 10.5% to $35.8 billion,
exceeding the Zacks Consensus Estimate of $32.8 billion.
The improvement in revenues and earnings was mainly attributable
to Ford's strong performance in North America and Asia Pacific
Africa. The company's results were disappointing in South America
due to unfavorable exchange rate as well as in Europe due to the
The company's cross-town rival
General Motors Company
) reported a 28.0% fall in earnings to 67 cents per share in the
first quarter of the year from 93 cents in the same quarter of
2012 (all excluding special items) due to lower earnings
generated from the company's all geographic operations except
Europe. Despite this, GM's earnings exceeded the Zacks Consensus
Estimate by 11 cents per share.
Few stocks that are performing well in the broader industry
Tower International, Inc.
). They carry a Zacks Rank #1 (Strong Buy).