Ford Struggles in China as Domestic Automakers Put Pricing Pressure | GuruFocus.com

Ford’s struggle in China continues as the company’s equity income from its two joint ventures in China dropped 34% in the second quarter of the year to $195 million. The company’s main challenge happens to be the domestic Chinese automakers that have started offering economical and competitive models using predatory pricing strategy in view of gaining market share.

Ford still remains unsure as what they must do to boost sales in China. A price cut would mean that they would have to compromise on their bottom line. The company plans to launch a revamped edition of the small EcoSport SUV later this year.

Besides, Ford announced recently that it signed a memorandum of understanding with Anhui Zotye Automobile with the vision to explore the development of a fresh line of all-electric passenger car in China. Anhui Zotye is a Chinese company that has been engaged in the manufacturing of all-electric and other vehicles over the past decade. As of now, good news is that commercial vehicle sales have begun to show strength. While Ford might have to wait a little to see its sales improve, the launch of the new portfolio of electric vehicle in China certainly brings a lot of excitement for the company.

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Ford Struggles in China as Domestic Automakers Put Pricing Pressure – GuruFocus.com.