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Ford nods to Australia as region’s fortunes turn around

By Barry Park, 27 Jul 2017 Industry

Ford announces Q2 global profit_wide

Asia Pacific sales help build Ford's strength as financial report hints at departing chief Mark Fields' separation package

FORD has talked up the growing contribution of Australia in its second-quarter earnings report, despite the brand’s sales flatlining here.

The US carmaker said the earnings from its Asia Pacific division had improved compared to a year ago, “particularly in Australia and India”.

It said Australia had helped to push the pre-tax profit of its Asia Pacific $US151 million ($A181 million) higher than the same time last year, returning the division to a $US143 million profit compared with an $US8 million loss in 2016 as Ford Australia prepared to shut down its Falcon and Territory production lines.

Ford was commanding a 6.6 percent market share in Australia in June, down slightly from the 6.8 percent market share it has averaged over the first six months of the year. Last month, it fell back a rung on the charts tracking Australia’s best-selling brands, falling from fourth in May to fifth in June behind traditional rival Holden.

Overall, Ford made $US2.0 billion in net income for the quarter, a 3.7 percent rise compared with the second quarter of 2016 as it benefitted from lower tax rates. Its rival, General Motors, fared a little worse, earning only $US1.66 billion for the quarter.

The quarter was a significant one in the US, with the carmaker launching its first over-the-air update to its vehicles’ software in the US. It used the technology to upgrade the multimedia units in about 800,000 Ford products to allow the Sync3 software to use both Apple CarPlay or Android Auto.

Locally, Ford is finally running out of stock of the locally made Falcon large car and the Territory large SUV, which ended production in October last year.

While stock of the Falcon appears to have almost dried up, as of the end of June Ford had about two months worth of Territory SUVs remaining in showrooms, anecdotal evidence shows.

Ford's global earnings report also spells out the separation package that Ford has offered to Mark Fields, the current chief executive of the global carmaker who will step down on August 1 after heading up what industry insiders say was a lacklustre time for the company.

As part of the deal, he will have access to two “executive vehicles” but need to pay for their fuel himself, access to two lease cars, and will be able to keep his Ford-issued phone, iPad, and any other bits of equipment the carmaker has installed at his house.