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Ford China launches 2020 Mondeo with new interior


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9 minutes ago, FordBuyer said:

In this new post covid economy, IMO a Fusion like vehicle is needed more than ever in the Ford stable. A $22,000 Fusion is much better value than $22,000 Ecosport and it's a value oriented economy now. Ford really needs to fill that value hole it has been giving little attention to except for Escape SE and noncompetitive Ecosport. North America really needs the Fusion NOW. Ford has extra capacity all over the place including both plants in Mexico. With the MKZ dumped, even Hermosillo could easily build 150,000 Fusions/year. 

 

A $22K Fusion wouldn't even generate enough profit to pay for the electric bill at the factory.

 

All this talk about needing cheaper vehicles now.   If you just lost your job or are in fear of losing your job you're not going to buy any new vehicle at all.  You'll keep what you have and if you have to buy something it will be a very cheap used vehicle.

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6 hours ago, ESP08 said:

 

Nice opinion, would you care to back it up with data?  

 

 

Yes sir ESP08. One analysis that can be done is to compare Return on Invested Capital with the cadence of new/refreshed models for a particular period of time.

 

Example. Below is a summary of ROIC calculated by Alix Partners a few years back for Ford, GM, a supplier firm, and some companies in other industries for comparison.

image.thumb.png.099644b9fd99008213a2799575f62359.png

 

For Ford and General Motors, here are their new and refreshed products in 2016 (U.S. market).

  • Ford: Explorer, F-Series Super Duty, MKX (1 refreshed model, 2 new/redesigned models)
  • General Motors: Bolt, Camaro, Cruze, Malibu, Silverado, Spark, Volt, CT6, Sierra (2 refreshed models, 7 new/redesigned models)

Ford's low ROIC and the low number of new/refreshed models indicates inefficiency in its product development and manufacturing processes.

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5 hours ago, akirby said:

 

A $22K Fusion wouldn't even generate enough profit to pay for the electric bill at the factory.

 

All this talk about needing cheaper vehicles now.   If you just lost your job or are in fear of losing your job you're not going to buy any new vehicle at all.  You'll keep what you have and if you have to buy something it will be a very cheap used vehicle.

Correct, the GFC showed us exactly what new vehicle buyers did and it wasn't running to cheap cars,

everything you've said on this topic in recent posts has been spot on in my opinion. 

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Wow! Ford spends money on the Chinese Fusion where it makes no money, only big losses, and has to share 50% of profits if it does make any. But in North America where Ford makes all its money they give up on a very competitive sedan that still sells in decent numbers. So Fusion customers have to go to GM, Fiat, Subaru, Toyota, Nissan, Honda, Kia, Hyundai, Mercedes, Audi, and BMW to find a midsized sedan. Oh, I forgot there is no market for a great looking sedan fairly priced that offers AWD option. Oh  Ford dealers want the Fusion? Who cares what dealers want. Bean counters at Ford know more what customers want. And all 11 other auto companies building mid sizers just don't get it. Sure. Right.

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13 hours ago, FordBuyer said:

Wow! Ford spends money on the Chinese Fusion where it makes no money, only big losses, and has to share 50% of profits if it does make any. But in North America where Ford makes all its money they give up on a very competitive sedan that still sells in decent numbers. So Fusion customers have to go to GM, Fiat, Subaru, Toyota, Nissan, Honda, Kia, Hyundai, Mercedes, Audi, and BMW to find a midsized sedan. Oh, I forgot there is no market for a great looking sedan fairly priced that offers AWD option. Oh  Ford dealers want the Fusion? Who cares what dealers want. Bean counters at Ford know more what customers want. And all 11 other auto companies building mid sizers just don't get it. Sure. Right.

It just convinced me more that Ford was planning to import cars from China until the whole thing went south, adding cars back into the US was definitely worth a shot when other regions carry a fair chunk of the costs.

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3 hours ago, jpd80 said:

It just convinced me more that Ford was planning to import cars from China until the whole thing went south, adding cars back into the US was definitely worth a shot when other regions carry a fair chunk of the costs.


They were. They even announced it and Trump called them out on it

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23 hours ago, rperez817 said:

 

Yes sir ESP08. One analysis that can be done is to compare Return on Invested Capital with the cadence of new/refreshed models for a particular period of time.

 

Example. Below is a summary of ROIC calculated by Alix Partners a few years back for Ford, GM, a supplier firm, and some companies in other industries for comparison.

image.thumb.png.099644b9fd99008213a2799575f62359.png

 

For Ford and General Motors, here are their new and refreshed products in 2016 (U.S. market).

  • Ford: Explorer, F-Series Super Duty, MKX (1 refreshed model, 2 new/redesigned models)
  • General Motors: Bolt, Camaro, Cruze, Malibu, Silverado, Spark, Volt, CT6, Sierra (2 refreshed models, 7 new/redesigned models)

Ford's low ROIC and the low number of new/refreshed models indicates inefficiency in its product development and manufacturing processes.

 

Was this not impacted by the expenditures required by changing the F-series to aluminum construction?   

One snapshot in time does not paint a complete picture.  

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23 hours ago, rperez817 said:

 

Yes sir ESP08. One analysis that can be done is to compare Return on Invested Capital with the cadence of new/refreshed models for a particular period of time.

 

Example. Below is a summary of ROIC calculated by Alix Partners a few years back for Ford, GM, a supplier firm, and some companies in other industries for comparison.

image.thumb.png.099644b9fd99008213a2799575f62359.png

 

For Ford and General Motors, here are their new and refreshed products in 2016 (U.S. market).

  • Ford: Explorer, F-Series Super Duty, MKX (1 refreshed model, 2 new/redesigned models)
  • General Motors: Bolt, Camaro, Cruze, Malibu, Silverado, Spark, Volt, CT6, Sierra (2 refreshed models, 7 new/redesigned models)

Ford's low ROIC and the low number of new/refreshed models indicates inefficiency in its product development and manufacturing processes.

 

Was this not impacted by the expenditures required by changing the F-series to aluminum construction?   

One snapshot in time does not paint a complete picture.  

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1 hour ago, ESP08 said:

 

Was this not impacted by the expenditures required by changing the F-series to aluminum construction?   

One snapshot in time does not paint a complete picture.  

 

Feel free to do a ROIC/product cadence analysis using different years or averages across multiple years, and using different competitors of Ford. While the numbers will vary from year to year, I think you'll find a general pattern of Ford getting less out of its capital expenditures for products compared to its competitors.  

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1 hour ago, rperez817 said:

 

Feel free to do a ROIC/product cadence analysis using different years or averages across multiple years, and using different competitors of Ford. While the numbers will vary from year to year, I think you'll find a general pattern of Ford getting less out of its capital expenditures for products compared to its competitors.  

If that is true (and I’m not doubting it), then it points to Ford’s costs being too high relative to competitors (a terrible place to be) and not product mix. 

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4 minutes ago, Trader 10 said:

If that is true (and I’m not doubting it), then it points to Ford’s costs being too high relative to competitors (a terrible place to be) and not product mix. 

 

Yes sir Trader 10, that's my understanding too. Just for clarification, the hardware of CD4 platform used by Ford for Fusion and Mondeo isn't inherently high cost compared to the platforms used by Ford's competitors for similar cars. Ford's costs being too high are more a result of processes at the company than its products or product mix.

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It’s interest that Ford only began to decry the Fusion when it’s high value buyers left mostly because of the ineffective 2015 makeover. 


Less than two years ago, the head of Toyota was warning North America that unless Camry became more profitable, it would be replaced by a cheaper import. I’m getting the feeling that a lot of manufacturers are in the same boat with profitability but find solace in taking market percentage as a second prize to keep stock holder from voicing displeasure with the region.

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38 minutes ago, jpd80 said:

Less than two years ago, the head of Toyota was warning North America that unless Camry became more profitable, it would be replaced by a cheaper import.

 

Yes sir jpd80, I remember that. In November 2017, Toyota Motor Manufacturing Kentucky plant manager told his associates "Toyota can build a Camry in Japan, ship it all the way to Kentucky and make more money selling that car than from one built at Toyota's factory in the state". As a result, TMMK employees worked hard to improve efficiency and cost reduction as they transitioned the plant to build TNGA platform vehicles.  https://www.autonews.com/article/20171120/OEM01/311209948/toyota-puts-u-s-workers-on-alert-made-in-japan-camrys-cheaper

 

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11 hours ago, rperez817 said:

 

Yes sir jpd80, I remember that. In November 2017, Toyota Motor Manufacturing Kentucky plant manager told his associates "Toyota can build a Camry in Japan, ship it all the way to Kentucky and make more money selling that car than from one built at Toyota's factory in the state". As a result, TMMK employees worked hard to improve efficiency and cost reduction as they transitioned the plant to build TNGA platform vehicles.  https://www.autonews.com/article/20171120/OEM01/311209948/toyota-puts-u-s-workers-on-alert-made-in-japan-camrys-cheaper

 

Thank you for chiming in with a link,

my point was that back then, Camry was sales leader but not making much profit. Fortubately, Toyota found ways to reduce costs

via greater efficiency. Ford on the other let Fusion sales ebb away and turned its back on cars, choosing new utilities instead.

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I remember over @15 years ago in an interview with someone from Toyota, they admitted they made no money on the Camry, but they felt that if they offered a good reliable product, then hopefully they would later upgrade to another vehicle/Lexus and keep the customer in that family. So their motivation on that product wasn't really profit, but long term customer base.

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2 hours ago, ANTAUS said:

I remember over @15 years ago in an interview with someone from Toyota, they admitted they made no money on the Camry, but they felt that if they offered a good reliable product, then hopefully they would later upgrade to another vehicle/Lexus and keep the customer in that family. So their motivation on that product wasn't really profit, but long term customer base.

 

I agree with that.  Though it does seem the American public is more forgiving of Japanese products than American ones.

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RAV4 is the new Camry or at least the direction Toyota expects those buyers to migrate,

it's the obvious reason why Toyota would is now running two plants with a ton of production

capacity. The return of the Vensza on RAV4's platform further signals Toyota's intentions.

Edited by jpd80
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12 hours ago, jpd80 said:

RAV4 is the new Camry or at least the direction Toyota expects those buyers to migrate,

it's the obvious reason why Toyota would is now running two plants with a ton of production

capacity. The return of the Vensza on RAV4's platform further signals Toyota's intentions.

 

And you can get a lease on a RAV4 XLE with fog lights, auto dimming mirror, and outside mirror turn signal lts. for $281/month with $2,500 down. Ford plays option games and opts out of segments right and left. Ford used to lead and now is just late to the party. Hopefully the Bronco brand and Mach E can reestablish some leadership. RWD Explorer and Aviator were also good starts. Shows they want to lead again.

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On 5/29/2020 at 11:25 AM, ESP08 said:

 

Was this not impacted by the expenditures required by changing the F-series to aluminum construction?   

One snapshot in time does not paint a complete picture.  


It wasn't so much the cost of using aluminum vs. steel, they managed to somehow make the cost difference negligible, but the cost of changing over 2 plants in less than a year. 

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10 hours ago, fuzzymoomoo said:


It wasn't so much the cost of using aluminum vs. steel, they managed to somehow make the cost difference negligible, but the cost of changing over 2 plants in less than a year. 

Well Ford has been saying that increasing costs of steel and aluminium are strong economic headwinds which is code for lower profits.

 

it just seems like Ford has had seen a  big blowout in costs in the past couple of years.

I think it’s suffering with so much US based manufacturing, not just wages it’s everything.

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2 hours ago, jpd80 said:

Well Ford has been saying that increasing costs of steel and aluminium are strong economic headwinds which is code for lower profits.

 

it just seems like Ford has had seen a  big blowout in costs in the past couple of years.

I think it’s suffering with so much US based manufacturing, not just wages it’s everything.


I was talking strictly about prices at the time of the launch of 2015 F-150. I know it's gotten more complicated since then. 

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7 minutes ago, fuzzymoomoo said:


I was talking strictly about prices at the time of the launch of 2015 F-150. I know it's gotten more complicated since then. 

I understand that, all costs and forecasts at the time were taken into account, it gave them a big weight reduction

and better fuel economy numbers, all of that completely justified on the data Ford had at the time....

 

All carmakers have been dealing with rising steel and aluminium prices, Ford seemed to make a bigger issue out of it,

so I'd take that as a sign of perhaps Ford ignored a few potential financial threats to get the ally F150 green lit?

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  • 2 weeks later...
On 5/28/2020 at 7:36 AM, akirby said:

 

If I develop 6 new platforms and 6 new powertrains and you only develop 3 of each in the same time frame I'm spending twice as much as you are no matter how they're shared.  That's all I'm saying.   That's not arm-chair speculation.

 

It's also not worth arguing about.

 

Toyota may keep the floorpan for a long time, but the rest of vehicle is getting periodic updates as well.  

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4 hours ago, ESP08 said:

 

Toyota may keep the floorpan for a long time, but the rest of vehicle is getting periodic updates as well.  


I think this could have been an acceptable proposition for the Fusion to help maintain lower costs, however Ford has done a terrible job managing the Fusion’s progress with minimal changes  over the past several years.  The argument the public was no longer interested in sedans isn’t completely legitimate when they never changed the Fusion enough to entice new or repeat buyers.  It was a self fulfilling prophecy.  

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Ford did the Toyota thing keeping the floorpan or whateever you want to call it... CD4 is the same thing as EUCD. 2013 model year CD4 Fusion was basically a mid cycle update of the 2008 EUCD Mondeo. We never got the EUCD one but that doesn't mean CD4 was brand new. Basically, CD4 Fusion should have not lived beyond 2018 model year but Ford kept it going with yet another late cycle update that was so mild no one even noticed.

 

2008-2012 Original EUCD Mondeo

2013-2020 Mid cycle update CD4 Mondeo/Fusion (probably should have come out with a new one in 2018 at the very least)

 

 

Same thing with Escape. The 2013 C1 Escape we got was basically mid cycle update of 2009 C1 Kuga. We never got the original 2009 Kuga but doesn't make the Escape brand new either. By the time Escape was replaced in 2019 (for 2020 model year), the European Kuga had gone almost 11 years with the same general shape. 

 

2009-2013 original C1 Kuga

2012-2019 mid cycle update C1 Kuga/Escape

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