BORG

And once again, everything I said was accurate. And yes, a million times I've commented on Ford's un-growable SUV manufacturing, although they certainly have capacity in Oakville and FlatRock. Ultimately Ford has a way to activate capacity if they were motivated to get to it but would rather sacrifice until they can open cheaper capacity in Mexico. All I ask is that people for once acknowledge these nuances and realities instead of taking offense.

Ford SUV sales are up 4% for the year. Explorer is down and and Escape is flat, Edge is up because it's recovering from the rocky 2015 launch, Expedition makes up the rest of the growth. Yes, indeed I did look closely at these numbers....did you? See, this is the thing, you can't take for granted that people have done their homework before carrying on a conversation, so I guess I have to spell it out each time. Ford SUV sales have hit a wall because they aren't growing in core segments and looking at a month's worth of data is only part of the data in the same chart. What makes this worse is that Ford is losing far more car customers than the industry and their SUV sales are in no way stopping this erosion. The only thing preventing enormous sales declines for the year is F-Series and Transit, not their SUVs. Which means Ford is just losing customers to other parts of the industry (and presumably not making them all van and truck customers). A 14% sales decline in cars is a combination of Focus, Fiesta, AND Fusion (actually all Ford cars are down). Fusion is down by 10%, or 30,000 units. Ford has lost 100,000 Car sales this year which means Fusion's decline makes up a 1/3rd of that. These are HUGE declines absorbed entirely by Trucks and Vans. Still, I commend Ford for keeping their sales charts flat despite collapsing demand for everything but the F-Series. But it's extremely unusual to see Ford falling so far behind in key car segments.

XTS?

Some good indicators at Lincoln with sales holding steady for MKZ and MKX despite the addition of Continental, typically Lincoln cannibalizes its other products. Continental is probably a little higher than it can sustain because of pent-up demand and order fulfillment (similar to what happened to Navigator). It'll be interesting to see where it ultimately lands, my guess is around 800-1,000/month in another year or two. Ford's car business is still shrinking very dramatically but Ford has been able to offset much of that this year with F-Series (and surprisingly Expedition). Ford's SUV sales are being propped up by Expedition increases, but otherwise their SUV/Crossover business has pretty much hit a wall.

I'm still amazed by how well the expensive CT6 can sell in a showroom with so many similar and cheaper choices. Caddy is really good at selling expensive cars, they need to push that farther.

I think the ultimate goal of the aggressive feature add at Ford was to increase value without increasing costs, that is helped by the large scale distribution of these technologies. Ford was (and in some ways still is) a brand that is thought of as a 'low' brand with cheap bland products and those customers don't like to pay very much for them. The rapid redevelopment of the brand under Mullally helped to correct this to get bigger spenders, although the quality fallout has likely contributed to bigger problems for brand perception. And some products simply didn't do well with customers because of quality and substantive issues, the Focus is a text book case on how not to globalize a product (it actually always has been). I think Ford's focus on design and features has helped tremendously but I would not be surprised now if Fields doesn't see the need to continue this path on all products going forward.

I actually have no problem with Lincoln's shared platforms, it's more of an intellectual exercise for auto critics than for customers who will definitely experience something very different from a mass-market car. I don't particularly like Lincoln's design direction right now, I know people seem to like it but for me it's just a duller version Audi or Jaguar design. I wanted something a little more progressive and less sedate and anonymous. But I wish them well with it. At least it's not ugly....just not alluring. It's appropriate for them and it's being done with some care which I can definitley appreciate, but it's clear it needs some iterations to sharpen up.

In recent years Ford was first with many standout features like Park Assist, the hands-free lift gate, capless fuel door, Sync/MyFord, inflatable seat belts and more. All of that happened under Mullally and was instituted corporate wide in a way I've never seen before from Ford, all their cars started sharing systems and were developed to share them. For me that was the most exciting part of Ford's transformation that there was finally some degree of continuity. Most recently Ford started catching up to some other automakers and leading many others with things like LTE radios for app control and standard push-button start. We also saw Sync 3 of course which pushed CarPlay and Android Auto company wide in a 12-month period which leapfrogged GM's early but slower rollout. Ford is also doing a good job adopting some features, although inconsistently, like LED headlamps as standard equipment. All of that is absolutely awesome and it's one of the reasons I like Ford. Then of course there is EcoBoost which has produced easily the best engines among the full-line automakers and available across a huge variety of products and prices, making them very accessible. And Aluminum, an incredibly brave but scary transformation for their most critical business. Although it may not have been worthwhile or necessary it is an important step toward the future. In any case, there is no question Ford is/was one of the industry's biggest influencers and that excitement helped drive their business and image. However there are features I would like to see more widely available, such as 360 cameras...no reason the Edge or Explorer shouldn't have these for example since they already have the cameras on the front. I'm not sure what the hold-up is with this but again they were also among the first in Detroit to put those camera on the front of their cars. Part of it might be Lincoln protectionism because of MKX. But carmakers like Nissan have these systems on everything and often with better camera stitching. Ford and Lincoln were extremely late on a few other things like LED DRLs but they are starting to catch up now and go a step further with LED headlights, although not quite as far as Honda has recently. The tech gap at Lincoln is a little more significant but they have made up for it in essential ways like seating and other thoughtful touches like push-button transmissions and theater lighting and excellent audio systems. The chasis also have technology that make a big difference despite the less sophisticated Ford hardware. Their biggest gap are the screens on the dashboard, either too small or the software is just too poorly designed to accommodate the feature controls that are needed. In any case, all of this is important for building a standout premium product that attracts younger more affluent customers who care about features (like me). I don't want them to lose sight of this.

That's definitely the Ford I remember, it's one of those things they had fixed under Mullally. It also explains why Ford's tech features have suddenly stopped progressing.

Ford is good at avoiding failure which seems to be the key difference. But Ford also has a history of risk aversion until Mullally really changed that, briefly but quickly. Right now Ford seems to be coasting since the rehab so the air is getting a little stale up here. Certain things concern me about Ford lately, their lack of marketing is perhaps the biggest one as the brand is starting to disappear altogether. They also lack design leadership at the company so they have made no progress since Mays left and have been iterating and recycling old designs for years with no clear approach to evolve, especially their interiors which have not moved upscale with the rest of the industry and MCEs have done very little. EcoSport is entering an important new segment but it's clear their efforts here are far too late and notably inadequate, they are going to have a very hard time adding new Ford customers to fill their shrinking car business. Ford is also shifting more of its attention toward commercial fleet products while their retail and car sales shrink, growing their dependency on F-Series even bigger.

I do think Lincoln is trying to replicate how the heart of the luxury car industry evolved 20 years ago from Lexus and Audi. They are very attracted to that low-cost/low-risk approach to growing a business from within Ford's existing resources. Those brand would later evolve into something much more substantive later. It's certainly MUCH harder for Lincoln now to penetrate the market in any meaningful way because it's so diverse and mature and it's clear at this stage that they still have many years to go before they figure out what brings in the new customers. Right now I am of the opinion that Lincoln is simply repeating its own history and the US market is mostly uninterested, but China has more breathing room. I don't trust Field's instincts for this business but I know he is also trying to clean-up a mess created in the wake of Mullally who pushed the company too far on thin resources, especially under One Ford. But I do get the sense that Fields is essentially returning Ford to its previous business practices and I know morale is very low and he is not liked. This has always been the problem with Detroit car companies, especially Ford, they basically leap from one crisis to another with wildly different leadership and vision. You would think a company with Family ownership could maintain some degree of continuity.

The lower displacement naturally aspirated 3.5L could better towing than the 3.7L?

They took it out of the F-150 and replaced it with the 3.5L which always surprised me, but it may have something to do with capacity needed for Transit. It's staggering how many engines Ford and Lincoln now have, I don't think there is any company that offers as many engine choices.

That's not true at all, Caddy sales are up HUGE from a global perspective. They sell more cars in China than Lincoln sells in the US (over 100,000).

I think it's more likely that the spending is justified by the spending of their customers.

Nobody is picking up on it which is still odd.

Such vehicles make much less sense today with Transit Connect and the variations of Transit.

Lincoln probably sells more of the cheaper models than other luxury brands with very few high-ticket items to offset the low end. Lincoln also sells quite a few of its vehicles to A/Z Plan employees in Michigan which I'm sure may skew them down even further. Caddy ATPs will likely continue to grow with the success of the CT6. One thing is for sure, Caddy is bringing in a TON of money right now which accounts for GM's higher ATPs and profits. It's also helping to fund advanced research into autonomous tech which is something Ford wants out of Lincoln profits. I've always wondered how many of Lincoln sales were to Ford employees and in Michigan. As for heavily discounted vehicles, the MKZ tends to get the most incentives, you can get those very cheaply.

Lincoln is reinforcing this strategy going forward and returning to better surface differentiation. We saw this in the 80's with shared platforms and alternative drivetrains and suspension. The experience is uniquely different to the customer but from a competitive standpoint it's clear Lincoln is really old-fashioned.

ATPs are actually lowest in the industry but appropriate for their level of investment and sales. It's incredibly difficult to exist as a non-global luxury brand like Lincoln right now, China has to change that so they can start getting the money to invest and bring up sales and pricing. The average price of a car in the US is now $33,560, Lincoln ATPs around $36 -37K. Caddy is at around $53K on far greater sales. That's a dismal stat for Lincoln since that falls just above their lowest sticker price.

Lincoln has always had a problem with consistency and commitment from Ford and it's going to be quite a trick if they can finally nail it down. I am growing more skeptical with costumer indifference to their efforts thus far but obviously this is going to be a very slow process.

A segment Lincoln originated with Navigator, which they still have btw.

This is an old car problem, not a new car problem. It's a luxury, like any other item it will break but you don't remove features just to keep it from breaking.

I remember when Ford completely eliminated the gas struts in their vehicles in the second half of the 2000's, even Lincoln's didn't have them. It was a time when Ford was heavily decontenting and cost cutting absolutely every part on a car. I know most Ford vehicles still don't have them and I know with further belt-tightening going on now they aren't likely to add them.

Lincoln's transaction price is barely in the luxury spectrum, and they sell the fewest of all luxury makers. That has to be a very hard business for Ford to make money on right now although it does explain why they are spending so little. I am surprised to see Caddy is commanding the biggest ATPs in the US, and they certainly sell far more vehicles than Lincoln, especially globally. I'm sure Lincoln will get some help with Continental and Navigator, although Continental is relatively cheap.