Deanh Posted April 28, 2015 Share Posted April 28, 2015 my bet is the "Canyonado" to an extent is cannibalizing the sales of its more profitable Fullsize, which in typical GM fashion is counter intuitive.....so Ford is probably thinking that a mini mini pickup ( ala Transit TC based ) could possibly be a total coup.... Quote Link to comment Share on other sites More sharing options...
bzcat Posted April 28, 2015 Share Posted April 28, 2015 GM has sold 37k unit Canyonado since inception, and is on pace to maybe 75k for a full year. Canyonado is basically all-new truck designed specifically for North America and GM ended fullsize van production (a very lucrative business for Ford at least) to make room for the trucks. Ford is on track to also sell about 60k Transit Connect vans this year... Just to put things in perspective... local production of Transit Connect is probably going to be a lot more lucrative and makes much more sense for Ford than to try to skim in the midsize truck market. Quote Link to comment Share on other sites More sharing options...
Biker16 Posted April 28, 2015 Share Posted April 28, 2015 GM has sold 37k unit Canyonado since inception, and is on pace to maybe 75k for a full year. Canyonado is basically all-new truck designed specifically for North America and GM ended fullsize van production (a very lucrative business for Ford at least) to make room for the trucks. Ford is on track to also sell about 60k Transit Connect vans this year... Just to put things in perspective... local production of Transit Connect is probably going to be a lot more lucrative and makes much more sense for Ford than to try to skim in the midsize truck market. wouldn't it be great if Ford could add Transit connect production to MAP? Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted April 28, 2015 Share Posted April 28, 2015 How would adding TC production to MAP make the Focus more profitable than cutting back to 2 shifts? Quote Link to comment Share on other sites More sharing options...
fuzzymoomoo Posted April 28, 2015 Share Posted April 28, 2015 How would adding TC production to MAP make the Focus more profitable than cutting back to 2 shifts? Quote Link to comment Share on other sites More sharing options...
Pioneer Posted April 28, 2015 Share Posted April 28, 2015 How would adding TC production to MAP make the Focus more profitable than cutting back to 2 shifts? Because all your fixed facility costs are spread amongst more production hours. The lights are on whether the line is ruining or not. Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted April 28, 2015 Share Posted April 28, 2015 (edited) Because all your fixed facility costs are spread amongst more production hours. The lights are on whether the line is ruining or not. AFAIK, facility costs per unit are far smaller than labor costs, and when you're running the line slower, you're jacking up labor costs per unit on a product that would seem to have higher than average labor costs to begin with (one would imagine that the labor differential between the Focus & Fusion does not match the price differential) Edited April 28, 2015 by RichardJensen Quote Link to comment Share on other sites More sharing options...
Biker16 Posted April 29, 2015 Share Posted April 29, 2015 Because all your fixed facility costs are spread amongst more production hours. The lights are on whether the line is ruining or not. thanks.... AFAIK, facility costs per unit are far smaller than labor costs, and when you're running the line slower, you're jacking up labor costs per unit on a product that would seem to have higher than average labor costs to begin with (one would imagine that the labor differential between the Focus & Fusion does not match the price differential) Ford only makes money when a product is sold. Selling fewer products means less revenue which reduces the potential for additional profit. It isn't about the profitability of a product, but the profitability of the products produced at that Facility, and the utilization of the fixed tooling at that facility. Regardless of how many shifts for is still paying interest on that investment, in this case it was a DOE loan. then there is Deprecation of that investment which is now being spread over fewer vehicles, increasing the cost per vehicle. http://energy.gov/lpo/ford-motor-company this is the flaw in Ford's phlosphy with their new plants. they are building plants with high VPH per line. when they should be investing in more shorter lines with lower VPH. MAP is a perfect example: 1 body shop (automated) 1 paint shop (automated) 1 Chassis line (semi automated) 1 Trim line. (manual) Attached stamping facilities. Your automated sections of your factory are high in fixed cost and low in variable costs Meaning generally the more you make the lower the cost per unit. your manual part of your plant the cost per unit is more directly related to that variable cost. More you make the the cost remains the same. The problem with the Long line is your locked into building vehicles at a high speed and high throughput to maximize efficiency. but as JPD mentioned cutting shifts is the best way to reduce costs, keeping throughput up, maximizing efficiency. the down side is you make a large adjustment to volume, that is inefficient compensate for without adding that shift back. like i said the decline in Focus and C-max sales isn't 33% so you are looking at faster line speed, or overtime or both to bridge the gap between demand and production. Furthermore Flex plants are the least efficient when they are producing complex and less complex vehicle on the Same line. bassically the line speed is being set by the most complex model the plant is building. In the case of MAP the variations beyond the body in white, ( trims levels, powerpacks, etc) that are installed manually on the line created a bottleneck, they couldn't handle the variations. In 2001 when Ford rebuilt cologne assembly the used a couple of innovations from the Japanese. One was the supplier park model Two was the concept of multiple trim lines. Cologne assembly was designed to produce up to 450,000 unit per year. Factory configuration was. 1 body shop (automated) 1 paint shop (automated) 1 Chassis line (Semi-automated) 2 Trim lines. (manual) The 2 trim lines allow for more product specialization while sharing the capital intensive body and paint shops. The robots could built and paint up to 8 different bodystyles on 2 different platforms. Originally Cologne built the Fusion MPV and the Fiesta 5 door on line #1 and the fiesta 3 and 5 door on line #2. as production fell Ford cut back production from 450,000 to 200,000, they moved MPV production to Romania, and idled Line #1 moving all production to line #2. The benefit was you were able optimize production in smaller increments without resorting to massive layoffs. Other benefits were: Less downtime for retooling: you could maintain production while half of the plant was being retooled. Efficient Flexibility: ablity to make more complex products without increasing the costs of simpler products ( Example: For C-max production ford increase the time for some stations to finish their tasks, even though 90% of all production did not need the extra time.) increased Factory utilization: the ability to fully exploit the automated tooling in the factory Better Quality: worker Are allowed more time at station to complete more tasks, and to complete multiple tasks, fewer hands involved in production more time to make sure things are right. In Closing, there were options other than what was done. MAP was configured like cologne, you could've more easily added more product to the factory, and had the ability to more precisely match production to sales volume. Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted April 29, 2015 Share Posted April 29, 2015 Ford only makes money when a product is sold. Selling fewer products means less revenue which reduces the potential for additional profit. By that logic, the largest automobile manufacturer in the US should have never lost a dime. 2 Quote Link to comment Share on other sites More sharing options...
630land Posted April 29, 2015 Share Posted April 29, 2015 How about orgainzing a protest march? That's what some on Allpar [Mopar fan site] want to do to Fiat Chrysler. They claim they can 'get them to make products we want', such as the Neon, Stratus, Dakota, LHS, and two door Sebring. So, if fans simply go to Dearborn and protest, that will surely change minds, right? ;-) But, what exact specs should this hypothetical 'compact' pickup be? The Unibody one in Thailand? A simple rebuild of the old Twin Cities one? A shrunken F Series? If one wants a compact/mid size so badly, then simply go to a Chevy/GMC store and get one of theirs. Quote Link to comment Share on other sites More sharing options...
akirby Posted April 29, 2015 Share Posted April 29, 2015 By that logic, the largest automobile manufacturer in the US should have never lost a dime. Some people simply don't understand the simple concept that you have to subtract cost from revenue to get profit. Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted April 29, 2015 Share Posted April 29, 2015 Not to mention the notion that Ford's NA plants should be more like the plants in a moribund division that hasn't been consistently profitable in almost two decades. Quote Link to comment Share on other sites More sharing options...
Donaldo Posted April 29, 2015 Share Posted April 29, 2015 By that logic, the largest automobile manufacturer in the US should have never lost a dime. And low volume manufacturers like Porsche and Ferrari should barely be making any money at all. 2 Quote Link to comment Share on other sites More sharing options...
akirby Posted April 29, 2015 Share Posted April 29, 2015 Maybe we should ask who was #1 in sales when GM went bankrupt? 2 Quote Link to comment Share on other sites More sharing options...
fuzzymoomoo Posted April 29, 2015 Share Posted April 29, 2015 Maybe we should ask who was #1 in sales when GM went bankrupt?but why would anyone want a little fact like that get in the way? Quote Link to comment Share on other sites More sharing options...
akirby Posted April 29, 2015 Share Posted April 29, 2015 but why would anyone want a little fact like that get in the way? How do you go bankrupt if you're making $1M/year? By spending $2M/year. 1 Quote Link to comment Share on other sites More sharing options...
Biker16 Posted April 29, 2015 Share Posted April 29, 2015 By that logic, the largest automobile manufacturer in the US should have never lost a dime. Margins only matter if you are selling product. Quote Link to comment Share on other sites More sharing options...
akirby Posted April 29, 2015 Share Posted April 29, 2015 Margins only matter if you are selling product. And what happens if you increase volume when you're losing money? Quote Link to comment Share on other sites More sharing options...
Deanh Posted April 29, 2015 Share Posted April 29, 2015 (edited) or have massive margins but sell nothing....ELR anyone?...... Edited April 29, 2015 by Deanh Quote Link to comment Share on other sites More sharing options...
Biker16 Posted April 29, 2015 Share Posted April 29, 2015 Not to mention the notion that Ford's NA plants should be more like the plants in a moribund division that hasn't been consistently profitable in almost two decades. I agree lets not base 82% of our car volume on platforms from that moribund division. Your assumption is that Failure or lack of profitability is a result of doing everything wrong, and that you cannot learn from another person's failure, is silly. it's not like Ford NA doesn't use supplier parks that were also perfected form that moribund divison. Other makers that also arrange Assembly plants in this way Honda Nissan Toyota Quote Link to comment Share on other sites More sharing options...
Biker16 Posted April 29, 2015 Share Posted April 29, 2015 (edited) And what happens if you increase volume when you're losing money? Are you saying that the transit connect isn't profitable, or wouldn't be profitable if it were produced in the US? Edited April 29, 2015 by Biker16 Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted April 29, 2015 Share Posted April 29, 2015 Your assumption is that Failure or lack of profitability is a result of doing everything wrong My assumption is that FoE does not know how to build cars profitably. Therefore suggesting that this division provides a useful template for the arrangement of assembly plants is ridiculous. And since you mentioned it: Whose margins in NA are higher? Toyota's or Ford's? Quote Link to comment Share on other sites More sharing options...
Deanh Posted April 29, 2015 Share Posted April 29, 2015 Biker, TC will eventually be coming here, but was initially introduced here as an experiment and the factories utilized were in Turkey, why build new lines here not knowing if the car is going to be a success? ..I don't rightfully know why production started in Valencia...probably using a plant already outfitted rather than undertake the huge expense ( and consequent production delays ) of upfitting a plant here....( and that's speculation ) Quote Link to comment Share on other sites More sharing options...
Biker16 Posted April 29, 2015 Share Posted April 29, 2015 Biker, TC will eventually be coming here, but was initially introduced here as an experiment and the factories utilized were in Turkey, why build new lines here not knowing if the car is going to be a success? ..I don't rightfully know why production started in Valencia...probably using a plant already outfitted rather than undertake the huge expense ( and consequent production delays ) of upfitting a plant here....( and that's speculation ) Why build new lines when the line already exists, at MAP, oops that right its not flexible. TC production was moved to Valencia because the economies of scale there with the C2 based KUGA, C-max and even the DC4 mondeo, S-max and galaxy. With the, Mondeo, Galaxy and S-max on the same trim line and the Kuga built on the same line as the Transit connect, all models share the same body and paint shop. http://wardsauto.com/auto-makers/ford-spain-adds-third-shift-transit-connect-plant Not bad for moribond division. Quote Link to comment Share on other sites More sharing options...
RichardJensen Posted April 29, 2015 Share Posted April 29, 2015 (edited) Not bad for moribond division. FNA made more money last year than FoE made in the last 20. Please tell me more about how these FoE manufacturing plants are so much better than those in FNA. Edited April 29, 2015 by RichardJensen Quote Link to comment Share on other sites More sharing options...
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