Europe: Ford changes small car strategy

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Ford Motor has decided to switch its position in Europe by leaving behind the minicar segment and setting its focus on the subcompact drivers with a larger Ka model in the making and an improved Ford Fiesta.

This change was made by Ford Europe’s CEO, Jim Farley, who has a new strategy for the carmaker to obtain a 6-8% profit margin for Ford at a European level. Ford executives explained that drivers nowadays do not want their cars bigger and they’re interested in hidden features and capabilities.

Roelant de Waard, Ford Europe’s head of sales and marketing explained that “Today’s customer doesn’t want to pay for features that are not relevant or not often used, so they are effectively right-sizing. We see a growing group of more affluent customers who want to downsize from larger more expensive cars, but who still expect the premium experience features and technologies they are used to”.

Ford is looking to reposition its small car models in a way that the brand continues to appeal to these buyers but also to possible new customers who are looking for an affordable vehicle. In autumn, Ford will start selling the new Ka at a price that starts at $11,221. Named Ka+, it will target buyers interested in budget-priced subcompacts like the Dacia Sandero model where styling is less important than reliability and fuel economy.

According to JATO Dynamics, this segment of cars priced at around $14,600 stands for about 400,000 unit sales in Europe and 13% of the B-segment car volume.