Will Chinese Drivers Pay Luxury Prices for the Ford Taurus?

[Anthony]

http://www.bloomberg.com/news/articles/2015-12-03/will-chinese-drivers-pay-luxury-prices-for-the-humble-ford-taurus-

 

Will Chinese Drivers Pay Luxury Prices for the Ford Taurus?

 

The Taurus was once America’s favorite family car, the top-selling model of the 1990s that popularized the aerodynamic look. Then a radical redesign failed to catch on, consigning it to an ignominious dotage as a rental car fleet mainstay. Now, Ford Motor is betting that this faded star can make a comeback, this time in China as a top-of-the-line sedan aimed at businessmen with a weakness for legroom and power-reclining massage seats.

 

That won’t be easy. With a starting price of 248,800 yuan ($39,000) that tops out at 348,800 yuan for the most expensive trim line, the Taurus is crossing into luxury sedan territory dominated by BMW’s 3 Series, Audi’s A4L, and Mercedes-Benz’s C-Class. It’s also almost double the price of Great Wall Motor’s H6, the best-selling SUV in China. The country’s buyers have been ditching traditional sedans for roomier utility vehicles and minivans, sometimes called MPVs (for multipurpose vehicles).

 

The Chinese market has slowed sharply since April, when Ford introduced the car there. Since then, a stock market rout and a weakening economy have sapped car demand, which was also hit by stricter vehicle registration curbs imposed by cities trying to stem worsening traffic and air pollution.

Things got so bad that the government in October cut a 10 percent vehicle purchase tax by half to encourage sales—but the incentive won’t apply to the Taurus because its 2.7-liter engine is too large to qualify. “The segment where it will play doesn’t grow anymore,” says Jochen Siebert, Shanghai-based managing director at JSC Automotive Consulting. “But Ford should be able to win some market share, provided they get the price right.”

 

 

 

Remainder of article at link

[bzcat]

This article is written by a moron it seems.

 

You know what else starts at 240~250k RMB? Buick Lacross, VW CC, Hyundai Azera. Just to name 3 random cars. Yes... let's compare the fully loaded Taurus price with a Great Wall SUV that uses a left over Isuzu platform. WTF BBQ?

 

Chinese buyers are ditching cars for SUVs? Maybe so... but the kind of buyer that Ford is courting with Taurus is not going to buy a Great Wall SUV. Ford has an Edge (shockingly, it starts at 248k RMB just like the Taurus! It's like Ford planned it that way or something...) for that buyer.

 

Taurus is no doubt probing the upper end of the price range which overlaps with luxury brand models but that's kind of the point... it's a much larger car vs. Audi A4L. Edge tops out at 430k RMB in China... that's Audi Q5 territory. But hey, maybe Bloomberg will publish an article compare the price of 430k Edge with a 7-layer burrito at Taco Bell.

Edited December 3, 2015 by bzcat

[theoldwizard]

Is this the "stretched" (for China only) Taurus ?

[jpd80]

Is this the "stretched" (for China only) Taurus ?

Yes, it's the CD4 based Taurus that has been lengthened and widened over Fusion & Mondeo

Chinese Taurus is laso the Continental's stable mate...

 

 

This article is written by a moron it seems.

 

You know what else starts at 240~250k RMB? Buick Lacross, VW CC, Hyundai Azera. Just to name 3 random cars. Yes... let's compare the fully loaded Taurus price with a Great Wall SUV that uses a left over Isuzu platform. WTF BBQ?

 

Chinese buyers are ditching cars for SUVs? Maybe so... but the kind of buyer that Ford is courting with Taurus is not going to buy a Great Wall SUV. Ford has an Edge (shockingly, it starts at 248k RMB just like the Taurus! It's like Ford planned it that way or something...) for that buyer.

 

Taurus is no doubt probing the upper end of the price range which overlaps with luxury brand models but that's kind of the point... it's a much larger car vs. Audi A4L. Edge tops out at 430k RMB in China... that's Audi Q5 territory. But hey, maybe Bloomberg will publish an article compare the price of 430k Edge with a 7-layer burrito at Taco Bell.

 

Well said, this article is written by somebody who has a colored view of Taurus based on North American experience,

the Chinese buyers have no such preconditioned views on Ford's big car. Oddly enough, the very reason that Chinese

buyers will take to the taurus is the generous internal dimensions and room, something decidedly lacking in the

US Taurus. With slightly different styling, this new Taurus could be rather successful in North America.

Edited December 3, 2015 by jpd80

[bzcat]

Yes, it's the CD4 based Taurus that has been lengthened and widened over Fusion & Mondeo

Chinese Taurus is laso the Continental's stable mate...

 

 

 

Well said, this article is written by somebody who has a colored view of Taurus based on North American experience,

the Chinese buyers have no such preconditioned views on Ford's big car. Oddly enough, the very reason that Chinese

buyers will take to the taurus is the generous internal dimensions and room, something decidedly lacking in the

US Taurus. With slightly different styling, this new Taurus could be rather successful in North America.

 

At the risk of turning this into another "where is Taurus?" thread... yes, there is no reason why Ford can't sell just as many CD4 Taurus as Toyota is selling Avalon, Buick is selling Lacross, or Chrysler is selling 300. But it seems that Ford would rather use production capacity in NAFTA zone to build more utilities (based on UAW negotiation), which makes sense.

 

The only thing that remains a variable in my opinion is how much Continental Ford is projecting to sell in its sales planning. It could be that they want to give themselves the flexibility to really crank out 100k Continental at Flat Rock if that car is a wild success. I mean if Continental doubles MKS volume, it will already be considered a wild success. Ford must be thinking really big.

[akirby]

Excellent point about Continental capacity - although I have a hard time believing they could sell more than 50K in North America.

[silvrsvt]

The only thing that remains a variable in my opinion is how much Continental Ford is projecting to sell in its sales planning. It could be that they want to give themselves the flexibility to really crank out 100k Continental at Flat Rock if that car is a wild success. I mean if Continental doubles MKS volume, it will already be considered a wild success. Ford must be thinking really big.

 

What luxury car that starts at over 40K sells in any numbers near 100K a year?

 

fuzzymoomoo, who works at Flat Rock has stated they are already having problems building enough Mustangs to keep up with world wide demand and with the Fusions being built there being the ones that are in demand (S and SE models I guess) so they don't have much slop room unless they add a third shift there.

 

Just had a random thought...we should be getting a new Fusion next year (well MCE) and Ford has stated they don't expect to need an overflow plant for the Fusion...on this contract. I see the MCE lasting at least 3-4 years...right when the next contract is due. Maybe overflow Fusion will move to Canada or something with the next gen Fusion.

[silvrsvt]

Excellent point about Continental capacity - although I have a hard time believing they could sell more than 50K in North America.

 

How many luxury cars sell in numbers like that? I can think of the Lexus RX, but thats about it.

[bzcat]

 

How many luxury cars sell in numbers like that? I can think of the Lexus RX, but thats about it.

 

BMW 3 series too.

 

But I think this illustrates my point... Ford must be thinking really big on Continental. 50k sales in the US is achievable but difficult. Another 5k in Canada, Mexico? Is China going to take 50k?

[fuzzymoomoo]

 

BMW 3 series too.

 

But I think this illustrates my point... Ford must be thinking really big on Continental. 50k sales in the US is achievable but difficult. Another 5k in Canada, Mexico? Is China going to take 50k?

What markets in Europe and the Middle East also sell Lincolns? Remember, Continental is the new brand flagship. I will be sold wherever Lincoln has a presence.

[silvrsvt]

 

BMW 3 series too.

 

But I think this illustrates my point... Ford must be thinking really big on Continental. 50k sales in the US is achievable but difficult. Another 5k in Canada, Mexico? Is China going to take 50k?

 

I think that is pie in the sky thinking...I think the Continental would be very lucky to see 30K units in North America. The cheaper MKZ has only sold 27K or so far as this November. I was also under the impression that China was making their own Contentials? Not to mention the Chinese economy seems to be going into the shitter as of late...which makes me wonder about the demand for it.

 

I took a look of sales numbers from BMW USA and Caddy and the best selling BMW was the 3 series 10k units in August of this year (60K for the year up till then) and Caddy's best selling product is the SRX at 6K units in October of this year with about 56K units so sold so far this year. All the other car they sell in the 1-2K range with the 5 series being an outlier at 4K units.

[rmc523]

 

What luxury car that starts at over 40K sells in any numbers near 100K a year?

 

fuzzymoomoo, who works at Flat Rock has stated they are already having problems building enough Mustangs to keep up with world wide demand and with the Fusions being built there being the ones that are in demand (S and SE models I guess) so they don't have much slop room unless they add a third shift there.

 

Just had a random thought...we should be getting a new Fusion next year (well MCE) and Ford has stated they don't expect to need an overflow plant for the Fusion...on this contract. I see the MCE lasting at least 3-4 years...right when the next contract is due. Maybe overflow Fusion will move to Canada or something with the next gen Fusion.

 

I think Fusion production is to move out of FRAP in a few years, at least that was how I understood the new contract. Where it goes, I'm not really sure...

[silvrsvt]

 

I think Fusion production is to move out of FRAP in a few years, at least that was how I understood the new contract. Where it goes, I'm not really sure...

 

Right, but that doesn't sound like its going to happen till after the current contract. So technically Ford is still building the Fusion, Mustang, Continental and Taurus (till they decide what to do with it) in the USA till at least 2019.

[akirby]

Correct. Personally I think Ford decided they just don't need a next gen CD4 Taurus in NA so they killed it before it got started. After all they're selling as many of the current ones as they can make so what's the rush?

[rmc523]

Correct. Personally I think Ford decided they just don't need a next gen CD4 Taurus in NA so they killed it before it got started. After all they're selling as many of the current ones as they can make so what's the rush?

 

Well, they do seem to be purposely limiting its' production numbers (and therefore sales numbers) in order to make more Explorers. So, it's possible (in theory) that they could sell more if they made more....not that I'm arguing for a GM-style approach.

[silvrsvt]

Correct. Personally I think Ford decided they just don't need a next gen CD4 Taurus in NA so they killed it before it got started. After all they're selling as many of the current ones as they can make so what's the rush?

 

As stated before...seems like production is being limited because of the Explorers popularity:

 

Taurus PI Explorer PIU

2010 68859

2011 63526 135,179

2012 66066 8309 158,344 5,863

2013 69063 10897 178,311 14,086

2014 52395 10234 189,339 20,655

2015 (Oct) 35801 8993 205,417 22,167

 

The Taurus is on pace to lose 20K or so units for the past two years...but the Explorer has gone up nearly the same amount, not including PI or PIU numbers. if the Taurus keeps at this pace, they'll sell 20-30K of them in 2016 or so..at that point its more or less stupid to keep it around.

 

There is a market for the car...and moving it to a platform that is shared with the Edge, Fusion and their lincoln equivalents would make sense even at selling 60-70K units a year...but it seems like Ford doesn't have the production room in NA to do that.

Edited December 3, 2015 by silvrsvt

[akirby]

I know it's production constrained.

 

I think they'll be replacing it with a CD6 version (Thunderbird?) but that's just a wild guess - no inside info.

[atomcat68]

I mean if Continental doubles MKS volume, it will already be considered a wild success. Ford must be thinking really big.

I think selling 2 a month is not a success...

 

Seriously I think the Taurus and Conti combined would sell 100,000 a year. I'd pull Fusion from that plant and do that, especially because the new Taurus is a stretch Fusion, I'd hope it would be somewhat easy to convert the plant for this.

[fuzzymoomoo]

I think selling 2 a month is not a success...

 

Seriously I think the Taurus and Conti combined would sell 100,000 a year. I'd pull Fusion from that plant and do that, especially because the new Taurus is a stretch Fusion, I'd hope it would be somewhat easy to convert the plant for this.

I would have to be painfully easy since it would launch well after the Continental. The amount of new equipment here for the Lincoln is crazy.

[theoldwizard]

Yes, it's the CD4 based Taurus that has been lengthened and widened over Fusion & Mondeo

Chinese Taurus is laso the Continental's stable mate...

WOW ! I must have been sleeping ! I missed the fact that the Chinese Taurus was going to be CD4 based (Continental stable mate).

 

So is the extra length going to be added to the front or rear legroom or split the difference ?

 

 

Segue : PI Utilities are outselling PI Sedans because they have more front and rear legroom !! Cops over 6'3" (and over 275 lbs) don't fit behind the wheel of a PI Sedan and most "bad guys" have to lay down to ride behind the cage in a PI Sedan. (Son-in-law is "on-the-job")

[rmc523]

WOW ! I must have been sleeping ! I missed the fact that the Chinese Taurus was going to be CD4 based (Continental stable mate).

 

So is the extra length going to be added to the front or rear legroom or split the difference ?

 

 

Segue : PI Utilities are outselling PI Sedans because they have more front and rear legroom !! Cops over 6'3" (and over 275 lbs) don't fit behind the wheel of a PI Sedan and most "bad guys" have to lay down to ride behind the cage in a PI Sedan. (Son-in-law is "on-the-job")

I know a lot of the room is added to the rear, but I'd imagine the front gains some too.

[bzcat]

 

I think that is pie in the sky thinking...I think the Continental would be very lucky to see 30K units in North America. The cheaper MKZ has only sold 27K or so far as this November. I was also under the impression that China was making their own Contentials? Not to mention the Chinese economy seems to be going into the shitter as of late...which makes me wonder about the demand for it.

 

I took a look of sales numbers from BMW USA and Caddy and the best selling BMW was the 3 series 10k units in August of this year (60K for the year up till then) and Caddy's best selling product is the SRX at 6K units in October of this year with about 56K units so sold so far this year. All the other car they sell in the 1-2K range with the 5 series being an outlier at 4K units.

 

Sky in the pie... yes. That was my point when I suggested Ford is thinking really big. Ford supposedly has 250k unit capacity at the Hangzhou plant for Edge and Taurus. I'm not sure they have room left over for Continental. If Lincoln sales takes off in China, I'm sure Ford will find a way to make the Continental (and MKX, MKZ, MKC) there, but for now, I think it is safe to assume all the Lincoln models sold in China will come from North America.

 

3 series sales are only about 65% of what it used to be because the coupe and convertible are now called 4 series. But combined, they move over 100k units.

[jpd80]

WOW ! I must have been sleeping ! I missed the fact that the Chinese Taurus was going to be CD4 based (Continental stable mate).

 

So is the extra length going to be added to the front or rear legroom or split the difference ?

You must have been snoozing for the last 12 months..(I joke.. )

 

116" wheelbase, more rear leg room and bigger trunk. track is also 2" wider as well,

cars were developed for China at Ford Asia pacific Geelong. maybe the parts supply

for the Chinese Taurus aligned with Chinese suppliers while Continental was done with

Nth American suppliers in mind.....Just a thought.

 

Word is that the cars are less than 150 lbs heavier than Chinese Mondeo

and will be built down the same line.

 

Hey Fuzzy,

I understand that there are two sides to FRAP, the Mustangs are built in one part and

other cars are being done on the former Mazda side, is that correct or are the Fusions

sharing the new body shop and final trim line?

Edited December 4, 2015 by jpd80

[fuzzymoomoo]

Hey Fuzzy,

I understand that there are two sides to FRAP, the Mustangs are built in one part and

other cars are being done on the former Mazda side, is that correct or are the Fusions

sharing the new body shop and final trim line?

The 2 sides to FRAP are all part of the same system. One side is Body and Stamping, the other is Final, with the paint shop being next to Final. There's only one line (contrary to what I was saying a while back.... oops) and the mustang and fusion both share the same line, as will Continental. The way I understand it is that the "new" part of the plant was built mostly for parts storage and handling. I haven't been here long (about 6 months) but the way I understand it is this is no different than the way it was done when Mazda was still here.

[bzcat]

Word is that the cars are less than 150 lbs heavier than Chinese Mondeo

and will be built down the same line.

 

Mondeo is build in Chongqing with Kuga.

 

Taurus is build in Hangzhou with Edge.