SAO PAULO – In 2010, Ford achieved its 28th consecutive quarter of positive results in South America, highlighting the importance of the region to company's global strategy. Marcos S. de Oliveira, president, Ford Brazil and Mercosur, discussed Ford South America Operations (FSAO) results and plans with @Ford Online, including background on the new Ford EcoSport, a global platform which is being fully developed by the Brazilian engineering group.
Q. FSAO contribution to Ford's overall results has been consistent. What can you tell us about the region's business strategy and the importance of South America operations in relation to Ford's global plans?
A. We have just achieved the 28th consecutive quarter of profitability in South America, reporting a full year pre-tax operating profit of $1 billion in 2010. These good results reflect that we are offering the right products for the region and also demonstrate the success of our product complementation strategy. FSAO produces and exports EcoSport, Fiesta RoCam, Ka, 1.6 Sigma engine, Ranger and Focus while importing the new Fiesta, Fusion lineup - including the hybrid version - and the 2.0 Duratec engine from Mexico, Edge from Canada and other products from Europe such as Transit and Kuga. Our goal is to continue generating positive cash-flow to support future investments and achieving a sustainable and profitable business equation for the region. We have announced an investment of U.S. $3 billion for South America operations from 2010 to 2015, to support capacity expansion, the modernization of plants and the development of new products. This includes the development of the first Brazilian-engineered global vehicle – the next-generation EcoSport compact SUV. In addition to the continuing development, production and sale of high-quality products, one of our key priorities for 2011 is accelerating our cost reduction efforts to offset external variables and also improve the competitiveness of our products within a very crowded and challenging South American market.
Q. What does the development of a global car mean for Ford Brazil?
A. It means that Brazil is fully engaged in the One Ford global platform strategy and our team is very proud and excited with this responsibility. Ford was the first automaker to establish operations in Brazil and also in the Northeast region, where one of Ford's five worldwide Product Development Centers is located. We have a talented team which has already shown that is able to develop high-quality products. Our engineers are doing an excellent job and, based on strong results achieved during early market research studies, I am confident the new EcoSport will be a huge success around the world.
Q. Which countries, besides Brazil, will produce the new EcoSport?
A. They are five countries in total. In due course, we will announce which ones.
Q. In 2010, FSAO also achieved positive sales results, such as the sales record delivered by Brazil in December. What contributed to this sales performance and what are your expectations for 2011?
A. Ford was the only company among the top four volume players capable of maintain or growing market share in Brazil during 2010. Competitive products, a very committed and capable team, and strong dealer network are some of the key reasons for our continuing sales growth and sales volume during the last six years. I am very optimistic about the Brazilian and Argentinean automotive markets in the coming months. Brazilian industry closed 2010 with 3.5 million units and the industry's forecast is to reach more than 3.7 million in 2011. Argentina closed 2010 with 654,800 units sold and the industry's forecast is to reach an increase of more than 10 percent this year. Regarding company's sales last year, Ford Brazil reached an all-time annual record of more than 363,000 units and Ford Argentina sales were 81,400 units. We also registered an excellent performance in the commercial truck segment, including Ford Cargo, which reached all-time record sales of 29,970 units in Brazil. During 2011, we will continue our efforts focused on profitable growth, developing our people, delivering high levels of customer satisfaction and strengthening the Ford brand in preparation for future global product launches.