Europe's sales results for Mustang in March -- a surprise for sports-car enthusiasts -- could be another telltale sign of a turning point for Ford's operations on the continent, which have struggled for years with billions in losses but are now generating profits.
Last week, Ford posted a first-quarter operating profit of $3.8 billion, a company record, compared with $1.7 billion a year earlier, mostly on the strength of North American results. In Europe, Ford's operating profit for the period was $434 million, compared with a $42 million loss a year ago. Ford's results have been profitable in Europe for four straight quarters.
"Germans have fallen in love with the Mustang," said Wolfgang Kopplin, managing director of Ford's German subsidiary. "Driving a Mustang GT on the Autobahn is a one-of-a-kind experience for people who love cars."
Unlike past generations of the model, the Mustang for 2015 was designed with features to please technically savvy European and other global customers. The car has an independent rear-suspension, which improves handling, powered by a fuel-efficient turbocharged engine.
It remains to be seen whether a one-month lead for Mustang can be sustained in Germany or how the new model performs elsewhere in Europe. The sales numbers for April have yet to be released. Still, Mustang's popularity among German buyers is a welcome sign that U.S. designers, engineers and business planners may finally be deciphering Europe's vehicle market. Mustang sales of 780 topped 911's 752 in March.
Although Mustang is relatively expensive in Europe compared to the U.S., it's far less pricey than Porsche 911. The GT version with a powerful V8 engine costs the equivalent of about $50,000 in Germany, compared with $32,000 in the U.S. Porsche's 911 starts at about 96,000 euros or $110,000 for a base car with no options. Porsche is a subsidiary of Volkswagen (VLKAY) .
Ford and other global automakers are looking forward to another strong month of vehicle sales in the U.S., the world's second-largest market after China but the most profitable. Despite warnings from analysts and signs that U.S. demand for vehicles might be softening, April sales are thought to have been strong, according to forecasts of Tuesday's results from manufacturers.
"Following a disappointing March, we expect sales to get back on track in April with a seasonally adjusted annual rate in the mid-17 million range," said Tim Fleming, analyst for Kelley Blue Book. "Increased fleet sales and rising incentive spending among automakers remain the factors to watch, but retail demand appears to be holding steady, signaling the industry's strong run isn't over quite yet."
Kelley Blue Book is looking for a year-over-year monthly sales increase for April to about 1.51 million vehicles, which would be a record for the month.