Europe is ‘starting to show signs of stability,” Stephen Odell, Ford of Europe CEO, said.

Ford ‘s European chief Stephen Odell said that industry-wide production cuts of 1.5 million to 2 million vehicles in Europe that have occurred or are announced will still leave output well above demand.

Ford estimates that Europe’s auto industry will be making at least 4 million vehicles a year more than market demand after those cuts are realized.

Ford expects to lose $2 billion in Europe in 2013 and the automaker is closing three plants and cutting 6,200 jobs in the region, or about 13 percent of its workforce, by 2014.

Odell told reporters at the company’s headquarters on Thursday that Ford is maintaining its sales forecast for total industry sales of 13.5 million vehicles in 19 Western Europe nations.

Ford’s sales in those 19 markets for June were 6.4 percent higher than a year ago, while the overall industry saw a drop of 6.6 percent in new vehicle sales, Odell said.

The European industry sales rate in June may have risen to 13.8 million in June, Odell said, a pace that would exceed Ford‘s full-year forecast for as many as 13.5 million deliveries.

Ford still plans to break even in Europe by 2015, Odell said.

Good indications

The industry is starting to show signs of stability, he said. “We’re not predicting any upturn yet, but there are certainly some good indications. Our prediction would be that we’re at or close to the trough. We don’t see any further decline at this point.”

Ford said it doesn’t plan further reductions in its production capacity. “We’re at the point where we have no more capacity announcements to make,” said Odell. “We’ve always said, though, that we’ll monitor the situation and if there were more catastrophic, as-yet-unpredicted changes, we would react to them. We feel that we’ve taken appropriate action.”

Ending the European deficit is one of Ford CEO Alan Mulally’s major challenges. Ford relies on its profitable North American operations and is looking to diversify its earnings.

Ford is introducing new models such as the EcoSport compact SUV in Europe to help reduce its reliance on low-margin sales to rental-car companies and dealer self-registrations. It also wants to boost the proportion of higher-profit sales to retail and company-fleet buyers.

The company plans to lower its share of deliveries to rental fleets to less than the European industry’s 13 percent average by early 2015 from 17 percent now, Roelant de Waard, the company’s head of sales for the region, said last month in an interview.

Ford’s European plan calls for it to maintain its 7.9 percent market share in Europe this year. In June, Ford’s European market share was 8.2 percent, up 1 percentage point from last June.

Ford said that June was the third straight month that it made year-on-year sales gains.

Ford is closing an assembly in Genk, Belgium; a Southampton, England, factory that makes chassis cabs for the Transit van; and a stamping plant in Dagenham, on the outskirts of London.