Auto News Roundup: Ford's Boost in Europe, Tesla Hits a Higher Gear, and GM's Latest Union Brawl

This week's big news in the auto business included happy milestones for Ford and Tesla Motors shareholders, signs that things are looking up for some (but not all) automakers in long-troubled Europe, and a war of words -- and more -- between General Motors and a powerful overseas union.

Here's what you need to know about the latest developments around the world.

Big gains for Ford in struggling Europe
We'll start with Europe, where new-car sales have fallen to a 20-year low and automakers have piled up huge losses. Ford is Europe's second-biggest auto brand after Volkswagen, and it has certainly had its share of red ink -- the Blue Oval's European branch lost more than $1.7 billion last year, and executives have predicted that losses could hit $2 billion in 2013.


The just-refreshed Ford Fiesta is one of Europe's best-selling vehicles. Photo credit: Ford Motor.

Ford launched a major turnaround effort last fall, hoping to break even in 2015 - but already, there are some signs that things are looking up. Ford said on Friday that its sales in the 19 countries it counts as "Europe" were actually up 6.4% last month -- even as the overall industry was down 6.5%. Ford said its latest new models were key contributors to the gains.

That drove Ford's Europe market share to 8.2%, up a full percentage point from June of last year. Better yet for Ford, this wasn't just a quick boost from rental-fleet business. Ford's rental-fleet sales are down in Europe, the result of a conscious decision to focus on more profitable retail and commercial-vehicle sales.

Ford lost $462 million in Europe in the first quarter. Its second-quarter earnings report is due later this month. If it shows that Ford's losses in Europe have narrowed, that will be a good sign that the plan really is working -- and it could give Ford's stock price a nice boost.

New highs for Tesla Motors -- and Ford stock, too
Bloomberg noted earlier this week that America's oldest and youngest automakers -- that would be Ford and Tesla Motors -- both saw their shares hit "100-week highs" on Tuesday.

For Tesla, of course, that was its all-time high. The upstart Silicon Valley automaker saw its shares boosted by the news that its stock will join the benchmark Nasdaq 100 Index, just three years after the company's initial offering.

Production of Tesla's hot Model S sedan is increasing, the company said this week. Photo credit: Tesla Motors.

Tesla CEO Elon Musk also said this week that the company has increased its production of the electric Model S sedan, surpassing its longtime goal of making 400 cars a week. Musk said the company is now aiming at a production rate of 800 vehicles a week by the end of next year. Tesla expects to sell about 21,000 cars this year.

Meanwhile, Ford stock is gaining thanks to a surging new-vehicle market in the U.S., which has given sales of its F-Series pickups a big boost in recent months. The F-Series is a key driver of Ford's profits, and the lineup's 22% sales increase in the first half of 2013 is expected to drive strong earnings in Ford's home market of North America.

Ford is also getting a lift from overseas operations: The company's sales in China were up 47% in the first half of 2013, as a major expansion effort continues to deliver promising results. And as I noted, there are more and more encouraging signs from Europe, where Ford is pushing to end losses.

General Motors' latest union battle
This time, GM's fight isn't with its longtime nemesis, the United Auto Workers -- Detroit's relationship with the UAW is actually on pretty good terms these days. The automaker's latest labor battle is taking place in South Korea, where GM has a major manufacturing presence that builds hundreds of thousands of vehicles a year, mostly for export to markets around the world.

Workers at GM's South Korean plants have been staging partial walkouts since July 4, the union's latest move in a contract negotiation that has become increasingly heated. GM executives have said they would like to build a more "collaborative" relationship with South Korean labor leaders, but the union is a combative one and negotiations haven't gone well.

To be fair, moves like this aren't helping: GM announced this week that production of the Opel Mokka, a small SUV and close relative of the Buick Encore that has become a surprise hit in Europe, will be moved from South Korea to Spain. 

Opel Mokka. Photo credit: General Motors.

The move makes sense for GM, which is struggling to keep its factories busy in recession-ravaged Europe, but it adds fuel to the fire in South Korea -- where union leaders have been blunt about concerns that GM might pack up and leave altogether.

Ford is growing fast in China's hot auto market -- and it's set to grow even bigger in coming years. A recent Motley Fool report, "2 Automakers to Buy for a Surging Chinese Market," says that Ford is one of two global giants poised to reap big gains in China's vast new marketplace. You can read this report right now for free -- just click here for instant access.

The article Auto News Roundup: Ford's Boost in Europe, Tesla Hits a Higher Gear, and GM's Latest Union Brawl originally appeared on Fool.com.

Fool contributor John Rosevear owns shares of Ford and General Motors. Follow him on Twitter at @jrosevear . The Motley Fool recommends Ford, General Motors, and Tesla Motors and owns shares of Ford and Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.


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David Ferraez

When will the unions learn that manufactorers have to be profitable..........they continue to slow down, strike, extort, damage things to get their way for their union leadership.......so they can stay elected.........sounds like congress............the hard workers are pawns and don't realize it.............so leadership has to make them unsustainable promises to get elected again.............this has to be corrected or yes..........leave Korea and move to Spain..................

July 15 2013 at 9:50 AM Report abuse rate up rate down Reply
aandreolij

Fords Future looks good

July 14 2013 at 7:29 PM Report abuse rate up rate down Reply