Ford takes aim at SA's entry-level market with new Figo

8th February 2010 By: Irma Venter - Creamer Media Senior Deputy Editor

Ford will re-enter the entry-level passenger car market in South Africa in the third quarter of this year with the launch of the new Indian-made Figo.

The company left this segment 18 months ago when it halted sales of the Ka range.

Ford Motor Company of Southern Africa (FMCSA) president and CEO Jeffery Nemeth says the company “is excited” about the launch of the Figo, as it will again put Ford in touch with a bigger customer base.

He adds that the small car provides the company with a “huge opportunity” as issues around affordability become increasingly important.

Nemeth says it is also expected that the passenger car market will exit the economic slump before the bakkie and truck markets.

“Having a new entry in the segment that is expected to recover the fastest will definitely provide us with some advantages.”

The Figo is manufactured in Chennai, following a $500-million investment by Ford.

Production started earlier this month.

The plant's production capacity is 200 000 units a year.

Nemeth notes that Ford has increased its market share in South Africa for the past three years, and that it is forecast to do so again this year.

FMCSA is placed in the top five vehicle brands in South Africa in terms of sales.

With total local sales anticipated to increase by roughly 6% this year, he adds that FMCSA expects its own sales to grow “by a little better” margin than that of industry.

Ford sold 52 000 vehicles in South Africa in 2008, with the recession seeing that drop to 38 400 units in 2009.

Other new models FMCSA aims to introduce into South Africa this year include the new Mazda 6, the Mazda 2 sedan, an updated Focus model, and the Fiesta four-door sedan.

ECOBOOST IS COMING TO SA

Ford will not introduce hybrid models to the local market any time soon, says Nemeth.

The US car maker produces more than 50 000 hybrids a year, including the Ford Fusion, and is the largest US producer of full hybrids, and second in the world, following Toyota.

Rather, says Nemeth, the company is looking at launching the EcoBoost engine locally with the next few years.

Ford's EcoBoost engines, based on the principle of improving fuel economy by gaining better performance from a smaller engine without compromising driving enjoyment, achieves a 10% to 20% improvement in fuel consumption.

The engine range is already available in the US.

Nemeth says the positive impact on the environment provided through hybrids are still limited as these cars remain too expensive to be used widely.

“Using technology to improve fuel consumption [thereby reducing carbon dioxide emissions] on the existing internal combustion engine, can have a bigger environmental impact.”