LONDON - A sharp first-quarter drop in Ford's European market share has surprised analysts - even though Ford says it expected sales to decline this year as key models approach the end of their life cycles.
Despite strong praise for the new Focus and Ford's claim of a good launch for the lower-medium-priced car, Ford's share in Europe fell more than that of any other major European player in the first three months of 1999.
Last year, Ford had 13.1 percent of first-quarter sales, second only to Volkswagen's 16.8 percent, according to ACEA, the European automakers' association.
But this year, Ford's unit sales fell 9.5 percent, and market share dropped two points to 11.1 percent. Ford fell to fourth place behind VW, General Motors and PSA/Peugeot-Citroen. The decline occurred despite Ford's acquisition of Volvo.
Ford's Fiesta and Mondeo are aging, and production of the Scorpio has ended. But sales of the newer Ka, Puma and Galaxy also declined in the first quarter.
Karl Ludvigsen, auto analyst at Ludvigsen & Associates in London, said: 'It must be very frustrating for Ford to have bought Volvo and still not be beating GM. The reason is the amazing performance of the Astra.'
Ludvigsen said it will be interesting to see how the Focus, a bold design for its market segment, performs against the more conservative Astra, which is nudging the VW Golf for leadership in that class.
The current Fiesta has been around since 1987 in essentially the same form. It gets a facelift this autumn, but it will not be replaced outright until 2002. Some of Ford's competitors in the supermini arena, including the VW Polo and Peugeot 206, are much fresher. The Mondeo, Ford's upper-medium entrant, will be replaced next year.
'We're at the low point in our product cycle,' said Ford spokesman David Reuter in Cologne, Germany. 'It is time to replace some of the major models. The Focus was the first. That will continue with the freshened Fiesta, the new Mondeo. The drop in share didn't come as an extreme surprise.'
Charlie Moss, analyst for J.D. Power-LMC in England, said: 'It's all down to the Focus. If they can't get the Focus to dominate the market, they could have a tough year.'
Ludvigsen noted that a few years ago, GM's Astra was viewed as a bit too radical. Now, the new Astra is conservative, and after a series of bland Escorts, Ford now is the bold one with the Focus.
Ford also suffered losses in other segments. Ka sales dropped 22.3 percent for the quarter as new minis like the VW Lupo and Daewoo Matiz entered a crowded field.