No path to profits: Why Ford exited 2 key Asian markets
Skip to main content
Sister Publication Links
  • Automotive News Canada
  • Automotive News Europe
  • Automotive News China
  • Automobilwoche
AN-LOGO-BLUE
Subscribe
  • Subscribe
  • Account
  • login
  • HOME
  • NEWS
    • Dealers
    • Automakers & Suppliers
    • News by Brand
    • Cars & Concepts
    • Final Assembly
    • China
    • Shift
    • Mobility Report
    • Special Reports
    • Digital Edition Archive
    • This Week's Issue
    • Evergreen Subaru is moving to a larger facility, but the store won’t be as big as the ship that got stuck in the Suez Canal.
      Was stuck ship headed for a Subaru store? (Spoiler: No)
      The first 2022 GMC Hummer EV Edition 1 sold for $2.5 million.
      Hummer EV, Bronco raise big money
      Tesla customers say the overcharges range from $37,000 to $71,000, according to CNBC.
      Buyers like Tesla, but not enough to pay double
      Ford created this gas-turbine truck for the 1964 World’s Fair.
      Ford's Big Red lives — parked in a garage
    • GAC Motor Co. launched sales of a new full electric crossover, the Aion Y, in March.
      New-vehicle sales rebound 75% in March from virus-hit 2020
      Wuling launched sales of its first pickup, the Zhengtu, on March 18.
      GM Q1 sales rebound but fall short of pre-COVID level
      The Ford Equator SUV arrived in the Chinese market on March 28
      Ford Q1 sales surge 73% over virus-hit 2020
      Xpeng P7 sedan on display at an auto show
      EV maker Xpeng setting up third plant to meet demand
    • The industry is racing to modernize the way in which EVs are built
      As EV output explodes in China, e-axle drive assembly automates
      Plus to roll big rigs on a ‘continuum' toward self-driving future
      Lidar moves beyond vehicles to underpin a reimagined logistics chain
    • Waymo self-driving van
      Waymo co-CEOs bring double vision for self-driving future
      Uber driver
      Uber, Lyft use rides to vaccines to get drivers, customers back on the platform
      Uber and Lyft
      Uber dangles higher pay to lure U.S. drivers back but warns it will not last
      Lidar system from Innoviz
      Shares of lidar sensor startup Innoviz rise in trading debut
    • Elon Musk interview
      Tesla’s Model Y, on sale since March, is a showcase of EV technologies competitors will benchmark.
      Technologies of Electrification
      Cadillac’s Lyriq EV will be unveiled Aug. 6.
      Future Product Pipeline
      A CALL TO ACTION
    • Lexus, Mirai get new advanced technologies
      On the baby front, Volvo takes the lead
      A standalone showroom is one optional improvement dealers can choose to show off the SUV line. Those who do get a slight increase in Bronco allocation.
      view gallery
      8 photos
      About 100 Ford dealers to invest in dedicated Bronco stores
      Waymo self-driving van
      Waymo co-CEOs bring double vision for self-driving future
    • Access F&I
    • Fixed Ops Journal
    • Marketing
    • Used Cars
    • Retail Technology
    • Sales
    • Best Practices
    • Dealership Buy/Sell
    • NADA
    • NADA Show
    • Automakers
    • Manufacturing
    • Suppliers
    • Regulations & Safety
    • Executives
    • Talk From The Top
    • Leading Women Network
    • Guide to Economic Development
    • PACE Awards
    • Management Briefing Seminars
    • World Congress
    • Aston Martin
    • BMW
      • Mini
      • Rolls-Royce
    • Daimler
      • Mercedes Benz
      • Smart
    • Ford
      • Lincoln
    • General Motors
      • Buick
      • Cadillac
      • Chevrolet
      • GMC
    • Honda
      • Acura
    • Hyundai
      • Genesis
      • Kia
    • Mazda
    • McLaren
    • Mitsubishi
    • Nissan
      • Infiniti
    • Stellantis
      • Alfa Romeo
      • Citroen
      • Chrysler
      • Dodge
      • Ferrari
      • Fiat
      • Jeep
      • Lancia
      • Maserati
      • Opel
      • Peugeot
      • Ram
      • Vauxhall
    • Renault
    • Subaru
    • Suzuki
    • Tata
      • Jaguar
      • Land Rover
    • Tesla
    • Toyota
      • Lexus
    • Volkswagen
      • Audi
      • Bentley
      • Bugatti
      • Lamborghini
      • Porsche
      • Seat
      • Skoda
    • Volvo
    • (Discontinued Brands)
    • Virtual reveals (Sponsored)
      • MITSUBISHI: 2022 Outlander
      • NISSAN: 2022 Pathfinder and 2022 Frontier
      • GENESIS: 2021 GV80
      • KIA: 2021 K5
      • LEXUS: 2021 IS
      • NISSAN: 2021 Rogue
      • TOYOTA: 2021 Venza and 2021 Sienna
    • Auto Shows
    • Future Product Pipeline
    • Photo Galleries
    • Car Cutaways
    • Design
  • OPINION
    • Blogs
    • Cartoons
    • Keith Crain
    • Automotive Views with Jason Stein
    • Columnists
    • China Commentary
    • Editorials
    • Letters to the Editor
    • Send us a Letter
    • Mach-E
      For Ford, 3rd-party charging network must improve to reap Mustang Mach-E potential
      VW logo with reflection
      VW lied to sell diesels; now it lied to sell EVs
      265725_XC90_Inscription_in_Birch_Light.jpg
      Volvo targets top talent in U.S., China with generous parental leave policy
      Fisker gets a rare second chance to build his own car company
    • VW's Joke Is On You
      Joke Is On You
      In case of supply chain woes, break glass
      view gallery
      3 photos
      Leo Michael Cartoons - Q2 2021
      Leo Michael: There's Nothing You Can Do!
      Nothing You Can Do
      Tesla's 'Technoking'
      Tesla's 'Technoking'
    • Shifting gears away from the stick shift
      SEMA still a wonderful circus
      Penske still has plenty of races to win
      Ford's turn in the hot seat
    • April 6, 2021 | For Volkswagen, authenticity is the only path forward
      March 30, 2021 | Tesla “changes” car industry
      March 23, 2021 | Remote work will continue after the pandemic
      March 16, 2021 | Industry offers warning to Apple
    • Dave Versical
      From doubts to duped: We won't be fooled again
      Willard J. De Filipps
      Dealing with a drop in LIFO reserves
      VW logo with reflection
      VW lied to sell diesels; now it lied to sell EVs
      Pandemic rules are choking the industry
    • Why Xiaomi holds promise of becoming formidable EV player
      Geely’s new EV push is decidedly new age
      Charging poles installed outside a Tesla store in downtown Shanghai.
      Unreliable public EV charging sites prompt automakers to take wheel
      VW Group's playbook to dominate EV market
    • ‘Voltswagen' April Fools' gag far from funny
      Less is more in lineups as well as on lots
      Electric vehicle charger
      Electric vehicle hype opens door to short sellers
      Address vaccine doubts at work to lead U.S. back
    • EV adoption in U.S. shouldn't be forced
      There goes VW recycling again
      Mixed-use plan a winner
      Electric is the way to go for mail trucks
  • DATA CENTER
  • VIDEO
    • AutoNews Now
    • First Shift
    • Special Video Reports
    • Weekend Drive
    • AutoNews Now: EV battery decision looms for SK Innovation, LG Chem
      AutoNews Now: Ford skipping summer shutdown at many U.S. plants
      Mercedes leads Lexus, BMW in tight luxury race
      AutoNews Now: Chevy's electric Silverado to have more than 400 miles of range
    • First Shift: Hyundai to idle more output due to chip shortage
      First Shift: Biden's EV plan said to include $100B for consumer rebates
      First Shift: Stronger auto emissions rules coming by July, EPA head says
      First Shift: Automakers urge U.S. government to help with chip crisis
    • Virtual sales manager Jay Barger
      'Glued to a phone': Acura store's virtual sales boss lifts deliveries, efficiency
      One man’s journey from homelessness to thriving dealer
      Bert Ogden Auto Group
      How a Texas group is cutting costs, saving millions
      COVID, chips and checks: Sales headwinds and tailwinds for 2021
    • Why the pickup is the auto industry's 'battleground'
      Carlos Ghosn's quest to restore his reputation
      Why Ford must execute to avoid 'deep trouble'
      Why Honda is 'locked and loaded' for 2020
  • EVENTS & AWARDS
    • Events
    • Awards
    • Congress Conversations
    • Retail Forum: NADA
    • Canada Congress
    • Europe Congress Conversations
    • Fixed Ops Journal Forum
    • Shift: Mobility at a Crossroads
    • 100 Leading Women
    • 40 Under 40 Retail
    • All-Stars
    • Best Dealerships To Work For
      • Register for the 2021 Best Dealership To Work For
    • PACE Program
    • Rising Stars
    • Europe Rising Stars
  • JOBS
  • AN Solutions
  • +MORE
    • Leading Women Network
    • Podcasts
    • Webinars
    • In the Driver's Seat
    • Publishing Partners
    • Classifieds
    • Companies on the Move
    • People on the Move
    • Newsletters
    • Contact Us
    • Media Kit
    • RSS Feeds
    • Shift: A Podcast About Mobility
    • Special Reports Podcasts
    • Daily Drive Podcasts
    • AAM
    • Cars.com
    • DealerPolicy
    • Gentex
    • IHS Markit
    • Remember Group
    • Reputation.com
    • Ricardo: Dave Shemmans
    • Ricardo: Marques McCammon
    • Allstate: Want more from your F&I?
    • Ally: Navigating the future of automotive retailing
    • Amazon Web Services: Any place, any time, any channel
    • Amazon Web Services: The power of the cloud
    • Amazon Web Services: Universal translator: Harnessing sensor data to build better automotive software
    • Capital One Auto: Dealerships remain vital to an increasingly digital car shopping journey
    • DealerSocket: 5 steps to modernizing the buyer's journey
    • Epic Games: Real-time tech is the next frontier of automotive
    • Epic Games: Transforming the auto industry with digital assets
    • FTI Consulting: Crisis as a catalyst for change
    • Google: 5 trends shaping the auto industry's approach to a new normal
    • Google: Google's dealer guidebook helps dealers navigate today's digital landscape
    • IHS Markit: Automotive loyalty in the wake of the COVID-19 recession
    • IHS Markit: COVID-19: The future mobility delusion
    • Level5: 2020 Automotive E-Commerce Report
    • Motormindz: Toward hyperconnectivity: 5 ways to position your business to profit from connected car
    • Naked Lime: Bring social reputation together as part of big-picture marketing
    • Wells Fargo Auto: Switching gears from LIBOR to SOFR
    • Ally: Do It Right
    • DealerSocket
    • Deloitte: Cyber everywhere: Preparing for automotive safety in the face of cyber threats
    • Facebook: The road to a zero-friction future
    • Guide To Economic Development
    • PayPal Credit: How consumer financing helps drive sales for online auto parts retailers
MENU
Breadcrumb
  1. Home
  2. Asia
January 31, 2016 12:00 AM

No path to profits: Why Ford exited 2 key Asian markets

Company to halt Japan, Indonesia operations by year end

Hans Greimel
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    Mark Fields, then Mazda's president, led a training session for employees in Hiroshima, Japan, in 2000. Fields, now Ford's CEO, is part of a generation of Ford executives who honed their skills with Mazda in Japan.

    TOKYO -- Nobuyuki Takahashi speaks for many Japanese in voicing what he faults and favors in Ford Motor Co. automobiles.

    "Most think they are too big and guzzle gas," said Takahashi, 55, a liquor salesman testing the feel of an Explorer SUV at a Ford showroom here bedecked with American flags.

    Ironically, Takahashi has been a Ford owner for 15 years, driving a Focus first and now a Fiesta. He likes Fords precisely because they are different from everything else on the road. "Japanese cars all look the same," Takahashi said. "Ford is a minor player, but I like the styling."

    For Ford's top brass, the brand is a little too minor.

    Frustrated by paltry sales, Ford pulled the plug last week on its businesses in Japan and in another giant Asian market, Indonesia. In both cases, it couldn't crack a Japan Inc. stranglehold.

    In Indonesia, the top 10 brands are all Japanese, locking up 97 percent of the market, LMC Automotive data show. In Japan, domestic brands account for 94 percent of sales.

    Ford cut bait to focus elsewhere.

    "It has become clear that there is no path to sustained profitability, nor will there be an acceptable return over time from our investments in Japan or Indonesia," said Karen Hampton, vice president of communications for Ford Asia Pacific.

    Ford will halt operations in both markets by year end.

    In Japan, the move is an embarrassing retreat by a Detroit manufacturer that once built cars there -- before the government effectively confiscated its plant ahead of World War II -- and later loomed large in the country as the parent company of Mazda Motor Corp. In fact, the man who signed off on the surrender, Ford CEO Mark Fields, is part of a whole generation of Ford executives who honed their skills while running Mazda in Hiroshima.

    Ford entered Japan in 1925, went dormant during World War II and, as recently as 1996, aided by a favorable dollar-yen rate, was selling nearly 15,000 imports a year there, plus Ford-badged vehicles built for it by Mazda. Last year, Ford sold only 4,968 vehicles, according to the Japan Automobile Importers Association.

    Pride, not profits, kept Ford and other U.S. brands in Japan.

    As Japanese brands steadily whittled away the Detroit 3's U.S. market share, the Americans were loath to admit they couldn't compete on Japan's home turf.

    General Motors has a thin lineup focusing mostly on image cars such as Chevrolet Camaros and Cadillacs. Chrysler hangs on, selling its 300 sedan; and Jeep is the most successful U.S. brand here, with sales of 7,132 vehicles last year, according to the importers association.

    Prospects don't look bright for the world's No. 3 auto market. Total industry sales, reflecting an aging and shrinking population, will fall every year through 2020, IHS Automotive predicts.

    Indonesia, like other emerging markets, has been in a slump lately. But long term, emerging markets are expected to dictate the auto industry's future winners and losers.

    Indeed, Indonesian demand will soar 32 percent through 2020, LMC forecasts. Even so, total sales then will be only 1.24 million vs. an estimated 942,000 in 2016.

    Last year, Ford says, it sold more than 1 million vehicles in China alone, where it is seeing profits from its investments. The automaker says it sold about 6,000 in Indonesia.

    In both Japan and Indonesia, Ford's range of imports couldn't match the locally built offerings, cars better tailored to local tastes and needs, from the Japanese makers.

    "Relying solely on imports does not make them competitive," LMC analyst Benjamin Asher said, adding that Ford lacks models in the key segments.

    Ford loyalist Takahashi called word of the brand's pullout "amazing." But would he ever consider the ¥4.89 million ($41,350) Explorer XLT he was sitting in?

    "Never," he said. "It's way too big."

    RECOMMENDED FOR YOU
    Tesla will 'definitely' begin India sales in 2021, Musk says
    Related Articles
    International operations help Ford's bottom line
    Letter
    to the
    Editor

     

     

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    Tesla will 'definitely' begin India sales in 2021, Musk says
    Tesla will 'definitely' begin India sales in 2021, Musk says
    Japan vows to spend even as profits plunge
    Toyota marshals group for Japan's pandemic effort
    Toyota marshals group for Japan's pandemic effort
    Sponsored Content: EV Display Technology Solution Guide
    Sign up for free newsletters
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    See more newsletter options at autonews.com/newsletters.

    You can unsubscribe at any time through links in these emails. For more information, see our Privacy Policy.

    Digital Edition
    Automotive News 4-5-21
    THIS WEEK'S EDITION
    See our archive
    Fixed Ops Journal
    Fixed Ops Journal 2-8-21
    Read the issue
    See our archive
    Get Free Newsletters

    Sign up and get the best of Automotive News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today

    Get 24/7 access to in-depth, authoritative coverage of the auto industry from a global team of reporters and editors covering the news that’s vital to your business.

    Subscribe Now
    Connect With Us
    • Facebook
    • Instagram
    • LinkedIn
    • Twitter

    Our mission

    The Automotive News mission is to be the primary source of industry news, data and understanding for the industry's decision-makers interested in North America.

    AN-LOGO-BLUE
    Contact Us

    1155 Gratiot Avenue
    Detroit, Michigan
    48207-2997

    (877) 812-1584

    Email us

    Automotive News
    ISSN 0005-1551 (print)
    ISSN 1557-7686 (online)

    Fixed Ops Journal
    ISSN 2576-1064 (print)
    ISSN 2576-1072 (online)

    Resources
    • About us
    • Contact Us
    • Media Kit
    • Subscribe
    • Manage your account
    • Reprints
    • Ad Choices Ad Choices
    • Sitemap
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Automotive News
    Copyright © 1996-2021. Crain Communications, Inc. All Rights Reserved.
    • HOME
    • NEWS
      • Dealers
        • Access F&I
        • Fixed Ops Journal
        • Marketing
        • Used Cars
        • Retail Technology
        • Sales
        • Best Practices
        • Dealership Buy/Sell
        • NADA
        • NADA Show
      • Automakers & Suppliers
        • Automakers
        • Manufacturing
        • Suppliers
        • Regulations & Safety
        • Executives
        • Talk From The Top
        • Leading Women Network
        • Guide to Economic Development
        • PACE Awards
        • Management Briefing Seminars
        • World Congress
      • News by Brand
        • Aston Martin
        • BMW
          • Mini
          • Rolls-Royce
        • Daimler
          • Mercedes Benz
          • Smart
        • Ford
          • Lincoln
        • General Motors
          • Buick
          • Cadillac
          • Chevrolet
          • GMC
        • Honda
          • Acura
        • Hyundai
          • Genesis
          • Kia
        • Mazda
        • McLaren
        • Mitsubishi
        • Nissan
          • Infiniti
        • Stellantis
          • Alfa Romeo
          • Citroen
          • Chrysler
          • Dodge
          • Ferrari
          • Fiat
          • Jeep
          • Lancia
          • Maserati
          • Opel
          • Peugeot
          • Ram
          • Vauxhall
        • Renault
        • Subaru
        • Suzuki
        • Tata
          • Jaguar
          • Land Rover
        • Tesla
        • Toyota
          • Lexus
        • Volkswagen
          • Audi
          • Bentley
          • Bugatti
          • Lamborghini
          • Porsche
          • Seat
          • Skoda
        • Volvo
        • (Discontinued Brands)
      • Cars & Concepts
        • Virtual reveals (Sponsored)
          • MITSUBISHI: 2022 Outlander
          • NISSAN: 2022 Pathfinder and 2022 Frontier
          • GENESIS: 2021 GV80
          • KIA: 2021 K5
          • LEXUS: 2021 IS
          • NISSAN: 2021 Rogue
          • TOYOTA: 2021 Venza and 2021 Sienna
        • Auto Shows
        • Future Product Pipeline
        • Photo Galleries
        • Car Cutaways
        • Design
      • Final Assembly
      • China
      • Shift
      • Mobility Report
      • Special Reports
      • Digital Edition Archive
      • This Week's Issue
    • OPINION
      • Blogs
      • Cartoons
      • Keith Crain
      • Automotive Views with Jason Stein
      • Columnists
      • China Commentary
      • Editorials
      • Letters to the Editor
      • Send us a Letter
    • DATA CENTER
    • VIDEO
      • AutoNews Now
      • First Shift
      • Special Video Reports
      • Weekend Drive
    • EVENTS & AWARDS
      • Events
        • Congress Conversations
        • Retail Forum: NADA
        • Canada Congress
        • Europe Congress Conversations
        • Fixed Ops Journal Forum
        • Shift: Mobility at a Crossroads
      • Awards
        • 100 Leading Women
        • 40 Under 40 Retail
        • All-Stars
        • Best Dealerships To Work For
          • Register for the 2021 Best Dealership To Work For
        • PACE Program
        • Rising Stars
        • Europe Rising Stars
    • JOBS
    • AN Solutions
    • +MORE
      • Leading Women Network
      • Podcasts
        • Shift: A Podcast About Mobility
        • Special Reports Podcasts
        • Daily Drive Podcasts
      • Webinars
      • In the Driver's Seat
        • AAM
        • Cars.com
        • DealerPolicy
        • Gentex
        • IHS Markit
        • Remember Group
        • Reputation.com
        • Ricardo: Dave Shemmans
        • Ricardo: Marques McCammon
      • Publishing Partners
        • Allstate: Want more from your F&I?
        • Ally: Navigating the future of automotive retailing
        • Amazon Web Services: Any place, any time, any channel
        • Amazon Web Services: The power of the cloud
        • Amazon Web Services: Universal translator: Harnessing sensor data to build better automotive software
        • Capital One Auto: Dealerships remain vital to an increasingly digital car shopping journey
        • DealerSocket: 5 steps to modernizing the buyer's journey
        • Epic Games: Real-time tech is the next frontier of automotive
        • Epic Games: Transforming the auto industry with digital assets
        • FTI Consulting: Crisis as a catalyst for change
        • Google: 5 trends shaping the auto industry's approach to a new normal
        • Google: Google's dealer guidebook helps dealers navigate today's digital landscape
        • IHS Markit: Automotive loyalty in the wake of the COVID-19 recession
        • IHS Markit: COVID-19: The future mobility delusion
        • Level5: 2020 Automotive E-Commerce Report
        • Motormindz: Toward hyperconnectivity: 5 ways to position your business to profit from connected car
        • Naked Lime: Bring social reputation together as part of big-picture marketing
        • Wells Fargo Auto: Switching gears from LIBOR to SOFR
        • Ally: Do It Right
        • DealerSocket
        • Deloitte: Cyber everywhere: Preparing for automotive safety in the face of cyber threats
        • Facebook: The road to a zero-friction future
        • Guide To Economic Development
        • PayPal Credit: How consumer financing helps drive sales for online auto parts retailers
      • Classifieds
      • Companies on the Move
      • People on the Move
      • Newsletters
      • Contact Us
      • Media Kit
      • RSS Feeds