NEW YORK (Reuters) - Ford Motor Co. is positioned to navigate rising oil and gasoline prices with the launch of new compact, fuel efficient cars likely to gain market share, a top executive said on Feb. 24.
Cars built on a compact car platform, such as Ford's new global Focus model, will take a larger share of the U.S. auto market in 2011 as gasoline prices continue to rise, said Jim Farley, head of Ford sales and marketing.
In Europe, almost a third of auto sales are in this segment, "so we still have a long way to go to grow," Farley told reporters outside an industry meeting in New York.
In the summer of 2008, when U.S. average gasoline prices rose above $4 a gallon, small-car sales rose to about a quarter of the U.S. market.
For the full year 2008 and in 2010, the compact car share of the U.S. market was under 20 percent. In 2009 it was 21 percent.
Farley spoke after announcing advertising plans for the Focus, which will be sold starting in Europe and North America in the next several weeks. The first U.S. television ads air March 1 during "American Idol."
Ford was launching its F-series pickup trucks during the gas spike in 2008, when compact cars were the fastest growing segment, Farley said.
Consumers are also drawn to new product launches and in addition to the Focus, recent and coming new car launches include Honda's Civic, the Chevy Cruze and the Chevy Sonic, and the Hyundai Elantra.
Gas prices are unlikely to escalate as quickly as they did in 2008, he said.
Considering new small car launches by competitors and the marketing push behind them, combined with rising fuel prices, Farley said, "I'm very thankful that we're launching now with the kind of product we have."
Dennis Virag, president of the Automotive Consulting Group, said in an interview with Reuters that all automakers in the U.S. market will be tested if U.S. gasoline prices rise to $4 or $5 per gallon.
Virag said that automakers with more small cars like Toyota Motor Corp, Honda Motor Co. and Hyundai Motor are better placed to thrive in a high fuel price environment.
"Ford will not be hit as hard as GM or Chrysler because Ford has a better product mix on their car side," Virag said of the ability of U.S. domestic automakers to pivot when pump prices spike.
(Additional reporting by Bernie Woodall in Detroit; Editing by Bernard Orr)