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Paris Motor Show: Ford of Britain boss questions discounting culture

Nigel Sharp, Ford of Britain boss, has voiced his concerns over the size of the real market in the UK during the September plate-change.

Speaking at the Paris Motor Show, Sharp said: “There is a lot of excess capacity in Europe and several companies seem to be having a go at the UK market.”

That means a lot of discounting along with some self-registrations among manufacturers and dealers to meet targets.

He said: “That said we have done good business in September - and around a quarter of that in the last two days of the month. I have been very happy with our retail sales. The fleet market has been more difficult while commercial vehicles keep us guessing."

Sharp questioned the discounting in the UK market. He said: “Some of the discounting that has been going on is silly unless some companies have much better costs than us, which I doubt."

Ford has been under fire over the past two years for increasing prices to counter the euro/pound exchange rate. It has since brought those prices down and Sharp said the company is now embarking on a new strategy.

He said: "If you look at the past 30 years there has always been a big difference between the advertised and transaction prices. This has largely been led by sales to the big fleet markets.

"We are now studying how to change this. Rather than bring the price down we are talking to customers about how much they are getting for their money - the new technologies which are built into it."

Enabling this is the new One Ford strategy, models based on common platforms with shared parts which give economies of scale and drive down production costs.

He said: "Four years ago we had 97 nameplates including Volvo, Jaguar and Land Rover and managing costs and quality was very difficult.

"Now the new C-Max and upcoming Focus share a platform and have 80% commonality of parts.

"This gives better control over quality plus potential sales of 2-2.5 million cars worldwide off one platform. This enables us to standard fit technologies such as front and rear cameras, safety systems and others normally found on high end vehicles.

"Rather than cutting prices or discounting we can talk to customers about what they are getting on the car. It's an education for dealers as well, where they were once very good at selling what wasn't on the car in terms of extras they have to become good at selling what's on it. It's a whole new challenge."

If other manufacturers continue to sell at a lower price is he worried about Ford losing its position as UK market leader?

"Well, I'm a proud man so I would not like to lose the number one spot, but I think we can remain as market leader but with a different mix of business. We may do less with daily rentals and big fleets but our new models put us in segments where we were previously not present - such as the new seven-seat C-Max."

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