Ford’s China sales increased in June as tax impact phases out

Ford logo in their auto plant

Ford Motor stated its China sales rose 15 percent in June, their strongest speed of the year, and it was positive about the outlook for the 2nd half as the market puts the phasing out of a tax cut behind it.

Peter Fleet, Ford’s Asia-Pacific chief, stated the first quarter had been hard after a purchase tax on small-engine cars increased to 7.5 percent from 5 percent previously.

Although Ford’s China sales dropped 7 percent in the first-half from the same period a year ago, they were up 7 percent in the second quarter.

Sales for June alone reached over 100,000 vehicles with deliveries of sedans including the Escort and Mondeo, which were harmed by the tax boost.

“I would anticipate to see for the third quarter strong single digit percentage growth (for) the market. That’s definitely how it wants to us based on the run rate and how the month of July has actually opened,” Fleet stated in an interview.

Ford’s level of discounting tracked a total 4 percent cost decline for the industry up until now this year.

“I’m not thinking about driving our costs down to drive market share,” Fleet informed.

Year-on-year comparisons will “get a bit tricky” in the fourth quarter as the sales increased so fast at the end of the last year as customers rushed to buy vehicles before the purchase tax increased, he included.

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