Ford (NYSE:F) said on Friday that its sales in Europe rose 10% in January, outperforming the overall market.
What Ford said: In the 20 markets that Ford defines as its "traditional" base in Europe (principally western and central Europe), it sold 96,900 vehicles in January, a gain of almost 10% from a year ago. That outpaced the overall market's gain by roughly 3 percentage points, it said, boosting the Blue Oval's market share 0.2 points to 7.9%.
Ford's European operation covers a total of 50 markets, including Russia, Turkey, several of the former Soviet republics, the Baltic states, and a few others. Across all 50 markets, the Ford sold 105,200 vehicles, up almost 9% versus industrywide growth of just 3%, it said.
What's working for Ford in Europe: "The European auto industry is off to a very strong start and Ford was able to outpace this growth thanks largely to demand for our SUVs, commercial vehicles and performance vehicles," said Ford Europe sales chief Roelant de Waard in a statement.
Like their counterparts in the U.S. and China, more and more European car-buyers are choosing SUVs, particularly small car-based "crossover" SUVs. SUVs are a traditional Ford strength, and in recent years the Blue Oval has moved to expand its SUV offerings in Europe.
That's paying off now. Sales of the subcompact EcoSport, a model originally developed for emerging markets and subsequently revamped for more upscale European tastes, were up 50% in January. Sales of the Kuga, the European version of Ford's compact Escape, were up 19%. Ford noted that it will launch the all-new-for-2016 Edge in Europe later in the first half of the year.
Performance vehicles sell in relatively small numbers, but they're very profitable products. Ford said that its combined sales of the Fiesta ST, the Focus ST, and the new-to-Europe Mustang almost tripled versus a year ago.
And just as we see in the U.S., Ford has a strong commercial-fleet business in Europe. Its sales of commercial vehicles, which in Europe includes the Ranger pickup and the Transit commercial-van range, rose 7% to give Ford's commercial-fleet operation its best January in Europe since 2008. Ford said that its share of the European commercial vehicle market is now a strong 12.7%.
Ford is emphasizing higher-profit sales: "Importantly, we gained [market] share by selling to retail customers while many others in industry are using self-registration and rentals sales extensively," de Waard said in a statement.
De Waard was referring to the old European practice of "self-registration," having dealers register new cars as demonstrators and counting those as sales. All of the automakers seem to do that to some extent, but Ford has been working to cut back on that practice as well as its sales to rental-car fleets. 81% of Ford's sales in January were to retail or commercial buyers, which it said is 3 percentage points better than a year ago and 11 points above the overall industry average.
What's ahead for Ford in Europe: Ford Europe is looking to build on the 10% sales gain it managed in 2015 by adding additional fresh products to its lineup. It said that it will launch 7 "new and refreshed" vehicles in 2016, including the new Edge and a revamped version of the Kuga (that will parallel the refreshed 2017 Escape), along with a refreshed version of the Ranger pickup and the new high-performance Focus RS.
Ford Europe posted its first profit in four years in 2015, the first fruit of a successful restructuring effort initiated in 2012 by then-CEO Alan Mulally. Europe chief Jim Farley said recently that the company will continue to find ways to cut costs and boost margins in Europe -- but those efforts will be helped by strong sales of profitable new products.
Based on these results, it looks like Ford is off to a good start in Europe in 2016.
John Rosevear owns shares of Ford. The Motley Fool owns shares of and recommends Ford. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.