The extra Russian mile

Updated 28 March 2015
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The extra Russian mile

WHILE MOST car manufacturers have fled the meltdown of the Russian economy, Ford has decided to soldier on. Ford has gone the extra mile in Russia by not abandoning its dealers, suppliers and employees.
There is no doubt that Ford is losing money in Russia at the moment. The Russian difficulties are political and outside the scope and control of commercial companies. There is no end in sight for the Ukraine crisis or the lifting of Western sanctions. Other companies decided to cut their losses and run away from the sinking Russian market.
But Ford calculated that by taking losses in the short term, it would be in a better position to capitalize on the departure of competitors. In order to do so, Ford has adopted a strategy of joint ventures with local partners; reducing reliance on imports and producing products more suitable to the Russian market.
Ford is launching four new models in Russia this year, including the Fiesta. Four of Ford’s models in Russia are crossovers which are more suitable to the country’s severe weather and road conditions. Ford will also open one engine factory and three plants which would allow it to meet Russian government’s target of local capacity.
These moves may indicate that everything is going well for Ford in Russia. The truth is far from it. Ford sales have plummeted 70 percent to around 3,200 cars. This fall is similar to what happened to other companies too. As the local ruble collapsed, car companies had to hike their prices to cover their losses and demand for cars vanished overnight. By contrast Opel is exiting the Russian market and GM is abandoning its local Russian production by the end of this year.
Ford’s shrewd move to soldier on in Russia may cost it a lot in the short term but if political conditions change in Russia — and they eventually will — Ford will be in the driving seat to lead the Russian in sales and market share.

Adel Murad is a senior motoring and business journalist, based in London.
Email: [email protected]


Porsche could build flying taxis, says sales chief

Porsche logo. (Shutterstock)
Updated 13 April 2018
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Porsche could build flying taxis, says sales chief

FRANKFURT: Volkswagen’s sports car maker Porsche could develop a flying passenger vehicle to compete with rivals in a possible market for urban air taxis and ride-sharing services, Porsche sales chief Detlev von Platen told a German magazine.
“That would really make sense. If I drive from (the Porsche plant in) Zuffenhausen to Stuttgart airport, I need at least half an hour, if I’m lucky. Flying would take only three and a half minutes,” Automobilwoche quoted von Platen as saying.
Porsche would join a raft of companies working on designs for flying cars in anticipation of a shift in the transport market away from conventional cars to self-driving vehicles shared via ride-hailing apps.
Volkswagen’s auto designer Italdesign and Airbus at last year’s Geneva auto show presented a two-seater flying car, called Pop.Up, designed to avoid gridlock on city roads.
The magazine said that under Porsche’s plans, passengers would be able to have some control over the flying vehicle themselves but would not need a pilot license because many of the car’s functions would be automated.
Potential competitors to a flying vehicle made by Porsche would be German start-ups Volocopter, backed by Daimler , Lilium Jet and eVolo, as well as US-based Terrafugia and California-based Joby Aviation.