Ford to outpace China market in 2010; sales strong in '09

SHANGHAI Thu Jan 7, 2010 2:01am EST

The blue Ford logo is seen on top of the Ford Motor Co. headquarters in Dearborn, Michigan December 16, 2009. REUTERS/Rebecca Cook

The blue Ford logo is seen on top of the Ford Motor Co. headquarters in Dearborn, Michigan December 16, 2009.

Credit: Reuters/Rebecca Cook

SHANGHAI (Reuters) - Ford Motor Co (F.N) posted a 44 percent jump in its China vehicle sales last year and aims to outpace growth in the world's largest auto market this year, banking on continued state policy incentives to drive demand.

Ford, which broke ground for a $490 million new China plant in September, sold 440,619 vehicles in the country in 2009.

That compared with 306,306 units in 2008 and marked an acceleration in annual growth from 32 percent in the first nine months of 2009, the company said in a statement.

"We think there will be something like 8 percent growth of the market this year," Nigel Harris, head of Ford's sales and marketing in China, told reporters. "Our ambition is to sell more than 8 percent."

Ford is the latest auto firm to report strong sales growth in the country, where automobile demand rebounded strongly last year thanks to Beijing's aggressive cuts in sales taxes on small cars and subsidies for buyers in rural areas.

Larger rival General Motors GM.UL, sold 1.83 million vehicles here last year, up 67 percent. Sales of Toyota Motor (7203.T) rose 21 percent to 709,000 units during the period.

Harris attributed Ford's record sales last year partly to its popular Focus sedan, which racked up a tally of 134,336 units, or nearly a third of its overall sales.

Sales of its all-new Fiesta small car, rolled out in March, came to 47,358 units, company data showed.

Ford also makes Mondeo, S-MAX, Volvo S40 and S80 among other models in a three-way tie-up with Chongqing Changan Auto Co 000625.SZ and Mazda Motor (7261.T). Overall sales of the venture soared 55 percent to 315,791 units in 2009.

Sales of Ford's Transit light commercial van, made at its partly owned Jiangling Motors Corp 000550.SZ, rose 22 percent to 33,585 units, it said.

CATCHING UP

Ford, the only Detroit automaker that has steered clear of emergency federal funding and bankruptcy, is a relatively latecomer to China, where GM and Volkswagen AG (VOWG.DE) lead.

However, it is speeding up expansion in China with a 150,000 unit new car plant in the western city of Chongqing, scheduled to start operations in 2012.

The number 2 Detroit automaker has also expanded its service warranty program for cars to 3 years/100,000 kilometers, effective on January 1, compared with 2 years/40,000 kilometers previously company executives said.

Ford had in October named the parent of Geely Automobile Holdings (0175.HK) the preferred bidder for its premier Volvo car unit and aimed to complete the deal in the first quarter.

Company executives declined to say whether Volvo S40 and S80 models will continue to be manufactured at Ford's China venture after the sale.

Ford sold more than 15,000 locally manufactured Volvo cars in China last year, or 3.4 percent of is total sales in the country, according to Jeffery Shen, president and CEO of Ford's China car venture.

(Additional reporting by David Lin; Editing by Jacqueline Wong and Lincoln Feast)