The small car market in Europe is facing a shake up.
Volkswagen Group will stop producing more than 40 car models as part of a new strategy, German newspaper Handelsblatt reported.
VW said last week it would invest billions of euros in electric cars, ride-hailing and automated driving to become a world leader in green transport by 2025 as it reshapes its business following a diesel emissions scandal.
At the same time, Ford said it is altering its approach to Europe to meet changing customer demands.
In a radical shift, Ford Motor is repositioning itself in Europe’s small car market by abandoning the minicar segment and focusing on subcompact customers with a larger Ka and a more upscale Fiesta.
The change highlights Ford of Europe CEO Jim Farley’s strategy of carefully picking his battles to achieve a 6 percent to 8 percent profit margin for the automaker’s European business.
Ford executives say car buyers now define success differently from in the past: bigger is no longer better and “thoughtful” rather than conspicuous consumption is the social norm.
The Ka+ will appear later this year with five doors and an extra 30cms in length but its also likely to cost more for some versions than the current car as it competes in a higher value sector than presently.
