Ford Motor Company (NYSE:F) reported growth in sales in Russia thus being the first major foreign manufacturer to report growth in the country over the past three years.
Ford has been one of the vehicle manufacturers that have previously been having a hard time pushing attractive growth in Russia. The past couple of years have been quite rough for foreign automotive manufacturers trying to make a positive mark in the Russian market. However, Ford has become the first to make a recovery from the otherwise volatile market.
Ford’s took a gamble and it paid off
Ford was among the numerous foreign manufacturers that had a rough time driving growth in Russia. What set the firm apart from its competitors in the country is the fact that it chose to take a gamble with the Russian market and it paid off. The automaker doubled down even when the conditions seemed very volatile in the market. The rivals opted to cut their losses and exit the market. General Motors Company (NYSE:GM) was one of the foreign manufacturers that decided to exit the market.
“Despite the economic turbulence, we didn’t cut investments and delivered the initial plan to launch seven new vehicles with a significant level of localization,” Ford Sollers joint venture, Mark Ovenden reported.
The recovering Russian market
Things have not always been as rough for companies such as Ford. Things took a wild turn after the Russian auto market took a tumble. Vehicle sales dropped by more than half since 2012 as a result of an economic crisis caused by Western sanctions and low oil prices. Reports indicate that the market dropped by 11 percent in 2016 and they dropped by 5 percent in the previous year.
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“The Russian market is starting to turn. Our intent is to build on that,” stated Ford CEO Mark Fields.
Ford sold 40,000 vehicles in the Russian market in 2016 which is a far cry from the 190,000 vehicles that it sold in 2008. Despite the massive drop, the company believes that things are recovering because it managed to secure a 10 percent growth from last year.
Ford stock closed the latest trading session at $12.58.