Ford Joins GM in New Focus on Latin-American Operations
By Michelle Krebs July 16, 2010Just weeks ago, General Motors Co. announced it is forming a new regional organization to administer to South America and this week chief rival Ford Motor Co. is indicating it, too, will be placing more emphasis on its Latin-American business.
In a reorganization of its Canada, Mexico and South America business units, Ford is appointing Eduardo Serrano, current president and CEO of Ford of Mexico, as executive director, Latin America. Serrano now will have responsibility for South America and Mexico.
The move appears to reveal Ford's desire to now have responsibility for Latin America in the hands of a specialist, Serrano, while Jim Farley, who formerly was Ford's vice president, Global Marketing and Canada, Mexico and South America operations, cedes responsibilities for Canada and Latin America in order to assume the new role a "Ford's global leader for marketing, sales and service around the world," Ford said in a statement.
In late June, GM said it was forming its all-new GM South America division to be headed by Jaime Ardila, formerly president and general manager for GM Mercosur. Ardila is to report directly to chairman and CEO Ed Whitacre. South America joined Europe, North America and international (Asia, Russia, Middle East) divisions.
"Jaime's number-one priority will be to ensure the very best for our customers in this important and growing region," Whitacre said.
Latin America is assuming a greater importance to automakers with a global presence because of its rapidly expanding middle classes; the region also includes the important market of Brazil. The region, as a whole, is expected to this year surpass Germany as the world's fourth-largest auto market.
With the explosive growth rate in China also seeming to be losing momentum, automakers are hedging their bets by beefing up operations in Latin America.
Ford and GM also could be tapping the Latin American operations for potential lower-cost replacements for their slow-selling midsize pickups in the U.S., a segment in which the domestic automakers have signaled they may be reluctant to make significant investments to replace the current-generation Ford Ranger and Chevrolet Colorado/GMC Canyon pickups.
In the U.S., the midsize pickup segment has seen two-thirds of its volume evaporate in the past decade, as buyers gravitated to larger but often only slightly more expensive fullsize pickups or more fuel-efficient crossover vehicles, leaving automakers to wonder, with extremely aged nameplates serving the declining segment, how best to address the trend. One prospect rumored to be under consideration is export of less-costly compact pickups designed for the Latin American market. - Bill Visnic, Senior Editor
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