FRANKFURT, Germany (AP) — Ford's struggling European business saw stronger sales in the first quarter as falling unemployment and cheaper energy put more money in car buyers' pockets.
Ford Motor Co. sold 335,100 vehicles in its 20 traditional European markets, a 12.5 percent increase over the same quarter a year ago.
Ford of Europe's vice president of sales, Peter Fleet, says the increase is due mostly to a recovering economy, not just low interest rates or economic stimulus programs. "Customers clearly have more money to spend," Fleet said in a conference call Tuesday with journalists.
The company also said it came in No. 1 in market share in commercial vehicles in Europe for the first time since 1997.
Fleet cited increased sales of models such as the new Mondeo mid-size sedan and the Kuga sport-utility. He also pointed to a drop in unemployment to 9.8 percent in the 28-country EU and cheaper fuel as fundamental factors.
"Whichever way you cut it, it's very clear that there is some strong industry growth in Europe," he said.
He said Ford's quality of sales rose as well as quantity. The company sold 73 percent of its vehicles to retail customers instead of rental firms, compared to 69 percent for the industry as a whole. He said Ford was getting strong uptake of around 70 percent for its most expensive option packages on its larger cars. The company is taking that further by introducing another expensive trim package, dubbed Vignale, on its Mondeo model.
Premium packages increase vehicle price and help mass-market carmakers like Ford compete with rival offerings from Mercedes-Benz, Audi and BMW. Those luxury automakers have increased their offerings in small and mid-priced cars to try to take business from mass-market carmakers.
Fleet declined to discuss the impact of higher sales on earnings. Ford, headquartered in Dearborn, Michigan, lost $1.1 billion before taxes in Europe last year, including $443 million in the fourth quarter. First-quarter earnings are due out April 28.