Ford (NYSE:F) was definitely late to the game in China, and because of that, the company has a large amount of ground to gain if it wants to match sales by its crosstown rival General Motors (NYSE:GM). At the end of the third quarter, Ford's market share in China was 4.3%, while General Motors' topped the 14% mark. The good news for Ford investors is that the region is expected to post significant growth for the rest of the decade -- from roughly 19 million vehicles sold to a forecast of 30 million -- and the folks at the Blue Oval are consistently growing sales and market share. Will Ford continue to grow its share in 2014 and beyond?
Today, Ford announced its December results in China: A 35% increase continues to impress investors. Ford China wholesales in December sold nearly 95,000 vehicles, up from 70,510 in the same month last year. That caps off Ford's strong year in the region as its wholesale volume reached 935,813 -- a strong 49% increase over 2012.
Ford's original goal was to double its previous market share of 3% to 6% by mid-decade, which would be fueled by the launch of 15 new models in the region. Last year Ford took seven models to China, including the Kuga (Escape), EcoSport, and the Mondeo (Fusion). Those three sold very well and posted wholesale unit sales of 95,891, 59,680, and 35,747, respectively.
While the new models are expected to fuel future growth, Ford's mainstay in the region greatly contributed to the solid yearly sales. The Ford Focus nameplate led last year's sales with over 400,000 sold. That's a 36% improvement, which is even more impressive when you consider the large base comparison number it was selling from.
As you can see below, it's been a remarkable two years in China, and Ford's continued investment in the region should enable the growth trend to continue.
"In 2014, by remaining focused on our plan, we look forward to serving more Chinese customers -- growing our capacity, expanding our dealership network, and continuing to bring them high-quality, safe, fuel efficient and smart Ford vehicles." said John Lawler, chairman and CEO of Ford Motor China, in a press release.
While Ford's overall story is great, investors shouldn't forget that its joint ventures are also performing well. Ford's passenger car joint venture Changan Ford Automobile, hit a new sales milestone in 2013, according to Ford, with over 678,000 in wholesales -- a 62% increase over 2012. The venture also had a record December selling over 70,000 wholesales compared to 49,212 during the same month last year.
Ford's commercial vehicle investment, Jiangling Motors Corporation, or JMC, also set a record in 2013, with 230,000 wholesale units sold. Ford decided to purchase an additional 2% of JMC shares last year, which brings its total ownership in the company to 32%.
Ford still has a lot of room for growth, and a long road ahead to catch rival General Motors in China. Look for Ford's new vehicle launches, which have been very popular with the Chinese consumer, to drive its growth over at least the next two years while it achieves its original goal of 6% market share. Ford's continued investment in joint ventures, production capacity, and vehicle launches will aid the company as it strives toward its goal of producing roughly 40% of its revenues in China by 2020. Reaching those revenue levels in China will be a big win for investors who would like Ford to be less reliant on North America for the vast majority of its revenues and earnings.