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Autoextremist: Ford in Free Fall


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I agree, buyers are not as loyal as they once were, they will buy what suits them best. Best vehicle/price wins.

 

 

That’s a popular theory but there is very little evidence to support that theory the last 10 years.

 

Well if that's true why not go $50k and up full on luxury? Why doesn't every automaker cut all smaller economy vehicles if there is no evidence to support that theory? Now I understand the majority of people on this message board are making 6 figures or more in annual income, but I think it still matters to pull people into your showrooms and then build them into long term customers. Heck even Apple who is known for being a "luxury" electronics supplier offers a $350 iPhone SE in hopes they can eventually move someone to the $999 iPhone X. I'd say Apple knows more about running a profitable company then Ford does if you look at their balance sheet. I just feel that it's important for Ford to compete in different price segments as they are still a mainstream automaker in my eyes.

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Well if that's true why not go $50k and up full on luxury? Why doesn't every automaker cut all smaller economy vehicles if there is no evidence to support that theory? Now I understand the majority of people on this message board are making 6 figures or more in annual income, but I think it still matters to pull people into your showrooms and then build them into long term customers. Heck even Apple who is known for being a "luxury" electronics supplier offers a $350 iPhone SE in hopes they can eventually move someone to the $999 iPhone X. I'd say Apple knows more about running a profitable company then Ford does if you look at their balance sheet. I just feel that it's important for Ford to compete in different price segments as they are still a mainstream automaker in my eyes.

 

There are plenty of sales where Ford can make money below $50k. That's why they offer it.

 

Apple doesn't sell the iPhone SE in hopes of getting people into an iPhone X. They sell the SE because they can make a profit at that price without greatly sacrificing profits of the higher-end phones. Most of the folks buying an SE would never buy the X. These are the folks that would buy the Samsung instead of the X if there wasn't the SE in it's place.

 

Not everything is sold in hopes of getting the buyers to buy a more expensive model in the future.

 

Oh, and making phones is really no comparison to making automobiles, where the profit margins are much thinner, and the competition is much more fierce, and the cost of entry is 40k times that of phones. I'd wager that Ford would make much more money selling cars than Apple would. See: Tesla.

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I have come to the conclusion blueovalforums is not a car enthusiast site , it is a shareholders site or at least it appears that way.

 

A car company as big as Ford goes all bat shit crazy and announces it is cancelling it's money losing cars which at this moment are

Fiesta, Focus, C-Max and Fusion and it is all good for the company.

 

Looking at this from afar one gets the idea that in USA driveways are nothing but a F150 and an Edge or something similar. So most North Americans that purchase Ford products do not have a car and a truck or some type of high rider in their driveway?

 

Fords decision not to offer cars anymore because they don't make money is fine if every other manufactures does the same because it only makes sense that they are losing on every car sold as well.

 

When the Ranger got killed it was "one" vehicle, how this compares to wiping out 4 vehicles is a very different scenario. But as long as Ford accounting looks good for a bunch of you here it must be the right move, because Ford always does the right thing right?

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That’s a popular theory but there is very little evidence to support that theory the last 10 years.

 

Just a year ago Ford was touting the fact that their sporty Fiesta, Focus, and Fusion models attract a younger, more affluent buyer that tends to opt for imports.

 

http://www.torquenews.com/106/ford-focus-fiesta-and-fusion-sporty-models-attract-younger-buyers

 

This whole misbegotten scheme has already gone off the rails. Ford is in a denial phase where they think the problem is the coverage.

 

http://www.leftlanenews.com/ford-responds-to-criticism-over-passenger-car-plans-100492.html

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I have come to the conclusion blueovalforums is not a car enthusiast site , it is a shareholders site or at least it appears that way.

 

A car company as big as Ford goes all bat shit crazy and announces it is cancelling it's money losing cars which at this moment are

Fiesta, Focus, C-Max and Fusion and it is all good for the company.

 

Looking at this from afar one gets the idea that in USA driveways are nothing but a F150 and an Edge or something similar. So most North Americans that purchase Ford products do not have a car and a truck or some type of high rider in their driveway?

 

Fords decision not to offer cars anymore because they don't make money is fine if every other manufactures does the same because it only makes sense that they are losing on every car sold as well.

 

When the Ranger got killed it was "one" vehicle, how this compares to wiping out 4 vehicles is a very different scenario. But as long as Ford accounting looks good for a bunch of you here it must be the right move, because Ford always does the right thing right?

Maybe ask yourself why Ford can never seem to make much profit in Europe - too much concentration on cars?

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That’s a popular theory but there is very little evidence to support that theory the last 10 years.

 

In the past 40 years, Corolla and Civic have been the only small car nameplates in Toyota and Honda's lineup. They have consistently gained market share while Ford, GM, and Chrysler lost it despite the fact they sold larger more profitable products.

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In the past 40 years, Corolla and Civic have been the only small car nameplates in Toyota and Honda's lineup. They have consistently gained market share while Ford, GM, and Chrysler lost it despite the fact they sold larger more profitable products.

The flip side is none of those players have cracked the full sized pickup market either-even after 20-30 years of trying.

 

Market share has gone down due to increased players in the market also.

 

Look at this way- what happens when say a Chinese maker comes into the market at the low end makes a good product that is competitive with the big players and sells for $2500 less then them? What is Honda and Toyota going to do? They the home market locked up unlike Ford/GM etc.

 

Comparing Japanese makers to US ones, at least in North America doesnt quite work.

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In the past 40 years, Corolla and Civic have been the only small car nameplates in Toyota and Honda's lineup. They have consistently gained market share while Ford, GM, and Chrysler lost it despite the fact they sold larger more profitable products.

The flip side is none of those players have cracked the full sized pickup market either-even after 20-30 years of trying.

 

Market share has gone down due to increased players in the market also.

 

Look at this way- what happens when say a Chinese maker comes into the market at the low end makes a good product that is competitive with the big players and sells for $2500 less then them? What is Honda and Toyota going to do? They the home market locked up unlike Ford/GM etc.

 

Comparing Japanese makers to US ones, at least in North America doesnt quite work.

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Well I remember when Ford claimed the compact and mid-size pickup market was dead forever in North America and that everyone will move up to loaded F-150s. There were plenty of defenders that said it was a great move. Now other automakers are having quite a bit of success in this category and where’s Ford? Still almost another year until we see a Ranger at a dealership. This right here is why I have no confidence in them to adjust their product mix if things change.

 

Generally Ford just gives up in a segment in NA when they can’t remain competitive. We saw it with small pickups and minivans and now passenger cars. What do they give up on next? Small CUVs? I guess we’ll find out soon.

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I have come to the conclusion blueovalforums is not a car enthusiast site , it is a shareholders site or at least it appears that way.

 

A car company as big as Ford goes all bat shit crazy and announces it is cancelling it's money losing cars which at this moment are

Fiesta, Focus, C-Max and Fusion and it is all good for the company.

 

Looking at this from afar one gets the idea that in USA driveways are nothing but a F150 and an Edge or something similar. So most North Americans that purchase Ford products do not have a car and a truck or some type of high rider in their driveway?

 

Fords decision not to offer cars anymore because they don't make money is fine if every other manufactures does the same because it only makes sense that they are losing on every car sold as well.

 

When the Ranger got killed it was "one" vehicle, how this compares to wiping out 4 vehicles is a very different scenario. But as long as Ford accounting looks good for a bunch of you here it must be the right move, because Ford always does the right thing right?

 

As to your first point, I am sure that many posters do look at things purely from the shareholder perspective while at the same time there are those who respond while only wearing the "enthusiast" hat. I like to think I represent both views. I grew up in a family where the cars, trucks and tractors were Fords. No discussion. Hanging out in one of my uncles heavy truck repair shop the the discussion was what "he" was going to do next-the "he" referring to Hank the Deuce.

 

My guess is those who look at both sides are in the majority.

 

As to your last point, for sure there are those who subscribe 100% to that view. If Hackett or whoever says something makes sense, so be it. Pass the Kool -Aid and please STFU!

But that is what makes this a good site-because enough people do share their views-regardless if they own a lot of shares or work on the line at MAP.

The flip side is none of those players have cracked the full sized pickup market either-even after 20-30 years of trying.

Market share has gone down due to increased players in the market also.

Look at this way- what happens when say a Chinese maker comes into the market at the low end makes a good product that is competitive with the big players and sells for $2500 less then them? What is Honda and Toyota going to do? They the home market locked up unlike Ford/GM etc.

Comparing Japanese makers to US ones, at least in North America doesnt quite work.

As for the fierce loyalty in the full size PU market-be it Ford, GM or "Dodge" I think it will be a matter of time before those who grew up in a household where the only vehicles they knew were Toyotas, Hondas etc we will start to see inroads. As the loyal "farm", "contractor" base ages, the new buyers will not have that same ingrained loyalty.

 

My two sons between them have 6 Fords. I can only hope they will pass that loyalty on to their kids

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Thats not because of anything they did though. Thats one of the most closed off car markets in the world. If its not a Japanese Company, GTFO.

It is really not that closed off they actually have less tariffs on vehicles than the US does to import them. It is just that GM/Ford never offered the Japanese a car that they wanted, and a country that is loyal to home brands in autos/dealers. Compounding that as those country loyal buyers moved on the market changed to microcars they didn't have anything to offer the market.

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I have come to the conclusion blueovalforums is not a car enthusiast site , it is a shareholders site or at least it appears that way.

 

A car company as big as Ford goes all bat shit crazy and announces it is cancelling it's money losing cars which at this moment are

Fiesta, Focus, C-Max and Fusion and it is all good for the company.

 

Looking at this from afar one gets the idea that in USA driveways are nothing but a F150 and an Edge or something similar. So most North Americans that purchase Ford products do not have a car and a truck or some type of high rider in their driveway?

 

Fords decision not to offer cars anymore because they don't make money is fine if every other manufactures does the same because it only makes sense that they are losing on every car sold as well.

 

When the Ranger got killed it was "one" vehicle, how this compares to wiping out 4 vehicles is a very different scenario. But as long as Ford accounting looks good for a bunch of you here it must be the right move, because Ford always does the right thing right?

 

You're ignoring the "white space" vehicles that will come to replace Fiesta/Fusion/Taurus. Ford's terrible marketing/PR approach made this move look worse than it will end up being.

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With Focus on C2 chassis - it wouldn't be a stretch (pardon the pun) to make Fusion (and MKZ/Zephyr) on same chassis at same plant. Taurus can still be made at same plant as Explorer on the CD6 chassis and what the hell, Continental can roll down the same line too..cost to stay in sedan business is minimal and Ford would have all bases covered with just two lines and many share components....but, then again, this would not "enhance investor value".

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With Focus on C2 chassis - it wouldn't be a stretch (pardon the pun) to make Fusion (and MKZ/Zephyr) on same chassis at same plant. Taurus can still be made at same plant as Explorer on the CD6 chassis and what the hell, Continental can roll down the same line too..cost to stay in sedan business is minimal and Ford would have all bases covered with just two lines and many share components....but, then again, this would not "enhance investor value".

 

I would expect if the market wants sedans they would just import them from China in the short term.

 

Ford Botched this so so so bad, they have the slightly tweaked '19 Fusion coming and basically just s*** all over it. If they are smart they will have a Fusion active concept in LA to show that the name isn't dead and where the direction is going. There is no reason that Ford couldn't go after the Outback with the Fusion Active. The pricing would as well, the Outback sells for $26,000-$38,000 that is a great spot for a Fusion Active in the lineup. I just hope the Focus Active gets AWD (optional) when it shows up here.

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With Focus on C2 chassis - it wouldn't be a stretch (pardon the pun) to make Fusion (and MKZ/Zephyr) on same chassis at same plant. Taurus can still be made at same plant as Explorer on the CD6 chassis and what the hell, Continental can roll down the same line too..cost to stay in sedan business is minimal and Ford would have all bases covered with just two lines and many share components....but, then again, this would not "enhance investor value".

 

TT-ahh-sounds like good logic, great plant utilization, great economy of scale when it comes to components-but bad press.

 

Anyway you can weave some electrification/autonomous driving into that thought?-then Hackett can buy into it. :worship:

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I would expect if the market wants sedans they would just import them from China in the short term.

 

Ford Botched this so so so bad, they have the slightly tweaked '19 Fusion coming and basically just s*** all over it. If they are smart they will have a Fusion active concept in LA to show that the name isn't dead and where the direction is going. There is no reason that Ford couldn't go after the Outback with the Fusion Active. The pricing would as well, the Outback sells for $26,000-$38,000 that is a great spot for a Fusion Active in the lineup. I just hope the Focus Active gets AWD (optional) when it shows up here.

 

How would Ford show a Fusion Active concept after killing the next generation Fusion development months ago?

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How would Ford show a Fusion Active concept after killing the next generation Fusion development months ago?

Funds were just removed from the program and program was moved to China, it is not dead per-say, It will be a more localized model.

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Why do we harp on the business aspect? To explain why Ford does some of the things it does. It does not mean we like it or support it necessarily, it just means that as a business decision their criteria makes sense.

 

E.g. Ford says it wants a 8% margin. They’re willing to take less revenue to do it. Why? Because it’s more efficient.

 

Other companies are ok with a smaller margin. And other companies don’t have some of the higher margin vehicles like Ford. E.g. Kia isn’t going to be able to sell a full sized pickup and make money. So for some companies the smaller cars are the only thing they can sell at volume so they stay in that business with smaller margins. Also they may be selling those vehicles globally so North America is just incremental volume. But even those companies are also going after the new smaller utes and “active” vehicles.

 

I guarantee you if Ford didn’t need MAP for Ranger/Bronco and they weren’t doing EVs/Autonomous cars then Fusion and Focus production would continue albeit with a slightly different product mix and probably lower volume. But they need that factory space and capital for other things. It’s never a single thing - it’s always 2 or 3 or 12 things that together go into a decision like that.

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