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FRANKFURT, May 24 (Reuters) - Rising demand prompted Ford Motor Co (NYSE:F - News) to say on Monday it will boost European production of cars and vans by more than 34,000 vehicles this year despite fierce competition in a slowly growing market.

"It is expected that the total Ford production volume for the full year 2004 will grow and exceed the level of 1,550,000 achieved in 2003," Ford of Europe said in a statement.

The second-largest U.S. car maker said its Focus and Focus C-MAX brands would account for the biggest increase, with more than 11,200 extra units.

Fiesta and Fusion production will increase by 7,500 while there will be also an extra 5,000 Mondeo cars. Production of the Transit Connect van will increase by 7,000 units.

Ford maintained its share of the European market at 11.6 percent in the first four months of 2004 while market leaders Volkswagen AG (XETRA:VOWG.DE - News) of Germany and PSA Peugeot Citroen (Paris:pEUP.PA - News) of France saw their share decline amid an onslaught from fast-growing Japanese and Korean carmakers.

Ford, whose brands include Jaguar and Volvo, said it would increase output mainly via weekend staffing and a higher daily production rate.

"Basically what we are seeing is what we had hoped this year, which is a little bit of strengthening of the market and certainly continued strong demand for our products," Ford of Europe spokesman Niel Golightly said.

"We are very confident that the earnings prediction that Ford of Europe put out is something that we are very much on track to hit."

Full Story HERE
 

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I'm not sure why but Ford Europe is the only "mainstream" brand that's not hemorageing marketshare (the VW, Opel, PSA and the others are way down), and they've only started a product blitz with the new C1 (Focus) line and the upcomming new Mondeo line.

Also the article doesn't mention it but the Euro' luxury makes are just a big of a threat as the Asians. BMW, MB, and Audi have moved agressively downmarket much faster than they have in NA. Incredibly the 3-series now outsells even the Mondeo in Europe! (the 3 is quite a different car there however, being available with little i4s and cloth seats and will less of a premium).

If Ford Euro' has a secret to their success it's matching the luxury makes for quality and dynamics while keeping its price advantage, unlike e.g. VW which has improved quality but has also increased their prices signifigantly and have seen their sales fall off. A 3-series becomes a harder sell with the latest Mondeos matching it for quality, handeling and equipment at a lower price, and the 1-series-matching new Focus will make that point even stronger.

This also illustrates why "mainstream" Euro' cars are increasingly too pricy for the North American market (where e.g. the new Focus is a serious BMW competitor, which it wouldn't have a hope of being in NA).
 
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