Ford CEO says no plans for alliances in Europe
GENEVA, March 5
GENEVA, March 5 (Reuters) - Ford Motor Co has no plans to form new alliances with other automakers in the European auto market, where the company may lose up to $600 million this year, Chief Executive Alan Mulally said on Monday.
Ford's approach to Europe differs from that of its Detroit rival General Motors Co, which last week announced a pact to share purchasing and vehicle development costs with French automaker Peugeot.
"We have no plans for any other alliances," Mulally told Reuters at a Ford event ahead of the Geneva auto show. "Now, we continually look for areas where we might share technology, where we have common interests."
Instead, Ford will continue "to match production with real demand," in Europe, a strategy Mulally says has been a tenet of profitable areas for Ford outside of Europe in recent years.
Ford lost $27 million in Europe last year and lost $190 million in the fourth quarter. Last week, Chief Financial Officer Lewis Booth said Ford could lose between $500 million and $600 million in Europe this year if overall auto sales in Europe come in at 14 million.
GM hopes the alliance will shore up its money-losing European unit, Opel. As part of the deal, GM will take a 7 percent stake in Peugeot, the second-largest European automaker.
Each company said they will not cut jobs or close plants in Europe, which has left many analysts skeptical of how the deal can save GM money.
Ford, the No. 2 U.S. automaker, has its own alliance with Peugeot, part of which is to make diesel engines.
"We also treasure our relationship with PSA," said Mulally, using the short-hand for Peugeot. "It's been mutually beneficial for both of us."
Ford sells vehicles in 19 markets in western Europe. Last year, Ford's European sales were 1.26 million vehicles, roughly flat with 2010 levels. In those 19 countries, the industry sold 15.28 million vehicles, Ford said.
Mulally said Ford's European unit "is really in a different place that some of our competitors" because the automaker has been aligning production with demand for several years.
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