Ford's slow China run persists, sales skid again in March

By Norihiko Shirouzu

BEIJING (Reuters) - Ford Motor Co's business in China continues to falter amid a dearth of fresh products, even though the American automaker earlier this week said it plans to launch two new models in the world's biggest auto market by the end of the year.

Ford's vehicle sales in China fell 11 percent in March from a year earlier, it said on Friday, as it struggles to stay out of the doldrums.

The Michigan-based automaker, whose sales in February fell 30 percent year-on-year, said sales volume last month totaled 83,666 vehicles.

Sales volume in the first quarter of this year fell 19 percent from the same period a year ago to 207,139 vehicles.

Ford's sluggish run comes as China's overall vehicles sales in March strengthened after a week-long national holiday - which saw sales drop steeply a month earlier - growing 4.7 percent from a year earlier to 2.66 million, according to data released earlier this week by an industry body.

Overall vehicle sales in China the first quarter were up 2.8 percent compared with the same period last year, according to the China Association of Automobile Manufacturers (CAAM).

Ford's January-March sales results show the company continued to have a tough time keeping pace even with the modest overall growth in the Chinese market.

Company officials have said Ford's business in China this year will remain pressured by the dearth of new or significantly redesigned cars models in its product lineup - a situation they indicated should last at least through the end of 2018.

"This year will be a bit like going through a tunnel," Peter Fleet, Ford's head of Asia-Pacific operations, told Reuters earlier this year. "We have to get through 2018."

The company's joint venture with the Changan Automobile Group has been a trouble spot for Ford's China business.

Sales by Changan Ford Automobile fell 22 percent in March from a year earlier to 46,217 vehicles. For the first three months of this year, sales slumped 26 percent on year to 124,459 vehicles.

Sales of vans and other commercial vehicles by Ford's second joint venture - Jiangling Motor Corp (JMC) - rose 5 percent year-on-year in March, but fell 6 percent in the first quarter.

Sales of Ford's premium Lincoln brand, in the meantime, rose 27 percent in March while first-quarter volume grew 10 percent on year.

"SUVs, commercial and luxury vehicles are key priorities of our strategy this year," Fleet said in a statement on Friday.

Earlier this week, Ford unveiled two redesigned models: the significantly revamped Focus compact car and the more modestly recast Escort. The company described the new Escort as a "mid-model-cycle" update of the existing model to keep it fresh in the marketplace.

(Reporting by Norihiko Shirouzu; Editing by Sunil Nair)