MARKET LEADER PREDICTS STAGNANT CAR SALES IN 2010
The head of Ireland’s top-selling car brand is predicting a stagnant market for car sales in 2010, following the freefall in registrations in 2009. Speaking at a media briefing today in Dublin, Eddie Murphy, Chairman and Managing Director of Ford Ireland, said he saw sales reaching just 60,000 units for the coming 12 months. However, a combination of product offers and finance availability mean Ford cars are more accessible to customers than previously, he said.
“Our industry is based on a car parc of 2 million, and an annual replacement rate in excess of 150,000 units,“ he said. “Various factors are conspiring to keep the market at well under half that figure. The replacement rate will rise, but for cash-strapped dealers it’s a question of how long they can hold out.”
Contending that a scrappage scheme could boost sales by as much as 10,000, he said it would provide the “necessary flow of oxygen to help dealers survive in this depressed environment.” It would also help ameliorate the employment situation in a sector which has contracted by 10,000 jobs since the middle of last year. “The economic argument for a scheme is all the more persuasive, when you factor in the cost of further job losses to the Exchequer in lower income tax and PRSI revenue.”
While emphasising that there are ‘no winners’ in today’s market, Murphy pointed out that Ford’s share of the car market has grown this year, from 12.6% to 14.1%. This he attributed to a ‘strength in depth’ in the Ford line-up, which has brought it leadership in 5 of the 8 segments in which it is present; for Ka, Fiesta, Focus, C-MAX and Galaxy.
Ford has a strong package of offers for the 2010 market across key models, among them the the highly spec-ed Focus TDCi, with air conditioning, alloys, fogs and Bluetooth voice control from €21,750, an effective saving of over €2,000. The acclaimed Kuga Zetec crossover now starts at just €27,495 and gains 17-inch alloys. The Mondeo range also receives enhanced specification, with the Style 1.8 TDCi including alloys, fogs and Bluetooth for just €26,995. The Mondeo Zetec 2.0 TDCi 140PS, despite its improved appointment, is down by over €2,000 at €29,995.
The product offers are supported by Ford’s current finance proposition through Ford Credit, which, despite claims of a lack of credit on the market, is yielding an 80% loan approval rate.
“These statistics counter suggestions that all banks are closed for business,” said Eddie Murphy. “We set credit availability as a cornerstone of our strategy for the 2010 pre-sell period, and it’s working.”
Commenting on a 70% decline in the van market this year, Eddie Murphy said: “Basically, until GDP starts rising again, we won’t start selling vans again.” However, he does see some upturn in the fleet market generally. “With leases being extended and purchases deferred this year, I expect to see greater replenishment of car fleets in 2010. There’s evidence of increased activity among fleet companies already.”
2010 will bring renewed product activity from Ford, with the revised S-MAX and Galaxy planned for quarter 2, as well as the new version of the popular Ranger pick-up. The striking all-new C-MAX and 7-seater Grand C-MAX will debut here in late summer. Ford will also launch a line of direct injection petrol engines called Eco-Boost, offering lower emissions and fuel consumption, but with high levels of torque ensuring enhanced driveability.
Ford’s fortunes in the US improved greatly in 2009, taking full advantage of the ‘cash for clunkers’ scheme, and netting a profit of nearly $1billion last quarter. The company now envisages “solid profitability” in 2011.