With General Motors (GM) - Get General Motors Company (GM) Report dominating headlines for its decision to offload perennial losing operations in Europe to Peugeot, Ford (F) - Get Ford Motor Company Report has been reinforcing a strategy that has helped it make money -- a lot of it -- on the continent.
Ford's introduction of upscale and performance versions of the Fiesta subcompact, an economical commuter car, continues a deliberate initiative begun five years ago to offer higher-priced cars that yield higher profits. The new Fiesta ST, a sporty version of the model shown at the Geneva International Motor Show, comes to European showrooms early next year.
The next generation Fiesta likely will follow to the U.S., though Ford isn't confirming that probability.
After years of losses, Ford posted more than $250 million in operating profit in 2015 and a record $1.2 billion last year. The European market has been on an upswing, while Ford has introduced fancier versions of its cars that it hadn't sold previously.
Fiesta ST, with a 197 horsepower, three-cylinder 1.5-liter engine, is known as a hot hatch or "pocket rocket" among enthusiasts, with heavier duty suspension parts that improve handling for those who like to push the limits on windy roads. Fiesta also comes in "ST line" configuration, with some of the visual cues of ST and fewer mechanical enhancements.
To make the engine sound even more aggressive, Ford offers an electronic sound enhancement system. The car can accelerate from 0-60 mph in 6.7 seconds, according to Car, the British enthusiast magazine.
Either of the ST versions should yield more profit for Ford on a per-unit basis than the standard Fiesta.
Ford has been importing its Mustang sporty coupe and a small number of its new Ford GT to boost the performance image of the brand, which it hopes to transfer to more everyday models.
"Accessible performance is at the heart of what we do at Ford," said Jim Farley, European chairman and CEO. "From the active aerodynamics of the Ford GT supercar to the Drive Modes of our next generation Fiesta ST, our Ford Performance models are developed using innovation that brings the driving thrill of our race cars to customers on the road."
In 1966, Ford's GT40 finished 1-2-3 at the LeMans 24-hour endurance race. Last year, the automaker returned to LeMans -- a hiatus of 50 years -- and won the GTE Pro Class with its new Ford GT racer. Earlier this year, the automaker said it will enter four Ford GTs in the 2017 LeMans race June 17-18.
Doron Levin is the host of "In the Driver Seat," broadcast on SiriusXM Insight 121, Saturday at noon, encore Sunday at 9 a.m.
This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.