PARIS — Ford’s vendor community in Europe continues to be “outsized” and must shrink in coming years, a prime firm govt stated.

“Total our vendor community is outsized, we’ve got to restructure,” Martin Sander, head of Ford’s passengers automobiles enterprise in Europe, instructed the Automotive Information Europe Congress right here on Wednesday.

Ford is exiting market segments similar to small and compact automobiles in Europe because it focuses on SUVs and crossovers which have increased revenue margins, lowering its want for a big dealership community that was set as much as cope with quantity gross sales.

“Our ultimate community is smaller than right now however nonetheless massive sufficient to serve our prospects in all places in Europe,” Sander stated. Some markets have already got the appropriate community in place to promote smaller volumes, whereas others “nonetheless have work to do,” he stated.

“We’ve got mentioned this with the sellers. They know what’s coming,” Sanders stated.

Within the U.Okay., Ford’s largest European market, the U.S. automaker shed 20 dealerships in 2022 and 25 in 2021 in keeping with knowledge compiled by Automotive Seller. Ford nonetheless has the U.Okay.’s largest vendor community.

In July Ford will construct the final ever Fiesta, as soon as the automaker’s best-selling mannequin within the area and for a very long time the No.1 small automobile in Europe by unit gross sales.

Its Fiesta manufacturing unit in Cologne, Germany, has been revamped to construct full-electric automobiles primarily based on Volkswagen Group’s MEB platform that underpins VW fashions such because the ID3 and ID4, beginning with the Explorer compact electrical SUV.

Ford plans will promote solely full-electric passenger automobiles in Europe by 2030.

Ford’s European market share fell to three.7 % within the first 4 months, down from 4.5 % the 12 months earlier than, in keeping with knowledge from trade group ACEA. Ford’s market share has greater than halved lately from 8.2 % in 2006.

Company gross sales mannequin ‘the longer term’

Ford is introducing a so-called company direct gross sales mannequin in Europe, which suggests shifting from wholesaling automobiles to sellers to promoting on to the client. The vendor turns into a gross sales ‘agent’ paid a set proportion of the sale worth.

Ford began the transfer to the company mannequin within the Netherlands early this 12 months, forward of implementing it throughout Europe “over the following years,” Sander stated.

“I am deeply satisfied company is the longer term” of auto retailing, he instructed the Congress.