Ford Sales In South Africa Strongest In Decades

By Michael J. Ureel, FCN

Riding a wave of economic expansion, Ford South Africa reported an almost 32 percent increase in vehicle sales in 2005 — as well as increasing market share. The South Africa auto industry overall reached record sales of 565,018 units — up 25 percent from 2004.

Ford brand sales for 2005 increased increase of 31.8 percent over 2004, with 51,517 units sold. December was a particularly strong sales month, with Ford brand posting its best result in 24 years.

"We are delighted with Ford's success in 2005," said Nigel Harris, vice president for Marketing and Sales for Ford Motor Company of South Africa. "Although the industry as a whole is growing, trading conditions are still extremely competitive with greater variety of models now on offer."

The South African auto industry is one of the most competitive in the world, with 45 brands selling more than 1,100 derivative vehicles to consumers. Ford has achieved a third-place market share of 9.1 percent, behind Toyota (22.2 percent) and VW (14.6 percent). That's Ford brand's highest ranking in a decade, and only the second time since 1984 that Ford has captured this large a market share.

The South African market has been undergoing economic and political development since the apartheid dismantling of the early 1990s. Ford had left during apartheid and returned as a joint-venture with mining company Samcor. Ford South Africa, too, has undergone its own transformations over the past five years. Deborah S. Coleman, former group managing director and chief executive officer of Ford Motor Company of Southern Africa, remembers the challenges Ford faced in 2000.

"It was a challenge of restructuring and resurrecting the brands, and putting South Africa on the road to profitability," she said. "Part of the challenge was putting in all the Ford processes and procedures." Coleman is now Vice President, Quality, for Ford Motor Company.

In a few years, the Ford team revitalized the Ford business and brand, bringing in new product, upgrading the dealers, and revitalizing the factory stream, Coleman said. They also worked with improving the skills of the workforce at both the engine and assembly plant.

"There was no other assignment like it," said Coleman.

Today, post-apartheid South Africa is experiencing strong economic growth.

"There have been a number of factors that have been the catalyst for the economic growth," said Harris. "These include the growing black middle class, lowest interest rate levels in 25 years and strong prices of commodities such as gold, platinum, coal and iron ore. As South Africa is one of the biggest commodity producers in the world, this is helping real GDP growth."

Products have led Ford's spectacular successes in 2005: Ford Fiesta, Bantam, Ranger and Focus all enjoyed record-beating success during the course of the year while the arrival of the Ford Ka late in the year further boosted sales numbers.

Ford Focus in particular has shined in the ultra-competitive in the important C segment, having achieved a record-breaking year and placing it among the top 10 volume sellers in the passenger car market, along with Fiesta. Nominated as a finalist in the upcoming Car of the Year competition in South Africa, Focus is set for further success in 2006. Similarly, Bantam has been a strong contender on the local market.

The Light Commercial Vehicle segment, thanks to the expansion of small and medium business sectors, also showed sales improvements of 26 percent in 2005. And the Ford Bantam, in meeting its customer requirements as a sturdy and dependable workhorse, also enjoyed a booming year.

"Overall, 2006 should be another very strong year for the South African automotive industry and similarly for Ford Motor Company," said Harris. "The positive growth trend in South African new vehicle sales that we have been experiencing over recent years is set to continue in 2006, albeit at a more subdued pace."