Changan Ford Takes Over Mustang Mach-E Operations in China

[ice-capades]

Changan Ford Takes Over Mustang Mach-E Operations in China

https://fordauthority.com/2023/08/changan-ford-takes-over-mustang-mach-e-operations-in-china/

 

While Ford’s EV business in the U.S. is facing some challenges at the moment, the same can also be said for the hyper-competitive Chinese market, where EVs are far more prevalent. Amid heavy competition, the Ford Mustang Mach-E has found it tough to find its proverbial footing, which has prompted The Blue Oval to slash the prices of its EV crossover not just once, but twice thus far. Back in June, FoMoCo shifted some members of the Ford Electric Mach Technologies (FMeT) sales staff to the automaker’s Changan Ford Automobile joint venture, but stopped short of saying it would shut down FMeT down entirely. Now, however, Changan Ford has completely taken over Ford Mustang Mach-E operations in China as of this past Monday, according to Automotive News.

 

Changan Ford will take over both sales and marketing of the Mach-E from here on out, a move that’s being made as yet another effort to spur sales. The change is also taking place with the intentions of further consolidating Ford’s Chinese operations, as well as boost the availability of the Mach-E in general. The automaker only sold 77 units of that particular model in China in the month of June, and 268 year to date – an 85 percent year-over-year decrease.

 

Changan Ford has been producing the Mach-E locally since its launch in China, but the EV crossover was previously only sold through dedicated storefronts. Now, however, the Mach-E will be available at the roughly 300 franchised Blue Oval dealers across the country, effectively tripling its sales footprint.

 

The Mach-E isn’t the only Blue Oval product to struggle in China, however, as CEO Jim Farley recently admitted that the company must change its strategy there to succeed – rather than designing models in China specifically for that market, the automaker will instead begin importing more vehicles, while also cutting some jobs – all of which is designed to reduce costs and make that business more sustainable.

Edited August 4, 2023 by ice-capades
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[rmc523]

Why on earth would you only sell it through a "mach e" location?  No wonder it's not doing well.

[ice-capades]

1 hour ago, rmc523 said:

Why on earth would you only sell it through a "mach e" location?  No wonder it's not doing well.

 

Sounds like an example of some Dearborn executive having a "better idea" and selling it as a solution!

[bzcat]

Ford just keep sabotaging itself in China 

[jpd80]

2 hours ago, bzcat said:

Ford just keep sabotaging itself in China 

Precisely, 77 sales in June, 268 for H1 shows how Ford has been hiding the truth.

Chinese buyers have moved on and this dog just won’t hunt.

 

I think time has run out for Mach E in China and transferring it to the local, Changan is a sign that Ford wants its costs gone form its books. So it’s fairly safe to predict that it will be gone in the near future, maybe it will be rebranded/repurposed as a lower cost  BEV to finish out any costs owed on the original project.

 

The lack lustre sales in North America with growing inventory tells us that buyers are balking at what Ford has as available stock.

Edited August 4, 2023 by jpd80

[bzcat]

It doesn't have anything to do with burying costs. Mach E is produced by Chang'an Ford so the cost is not moving, it was alway a Chang'an Ford cost. They are just getting rid of the separate distribution network setup to sell Mach E. Ford China wanted a separate direct to consumer sales process for Mach E where customers have to reserve the car from the website and bypass going to Chang'an Ford dealers. Ford setup a few separate showrooms in big cities but the only real way to buy the car is thru the internet.

 

Taking Mach E out of Chang'an Ford sales channel was probably a fever dream of some marketing expat from the US. Totally ignores how the Chinese market works. Another big mistake was calling it Mach E in China instead of coming up with a Mandarin name, probably another decision made by expat Ford China executive. The separate sales teams and showroom means regular Chang'an Ford dealers didn't have an opportunity to up-sell the car and the new Mach E sales team has no customer leads for a car that has no Mandarin name.

 

The majority of car sales in China is done through the sales people combing thru their contact list... in another word, by relationship. The idea that Ford can just setup a few dedicated showrooms and wait for customer to come find it on the internet shows a complete lack of knowledge on how cars are sold in China. It's really mind boggling for a company that has been in China for almost 2 decades. The fact that this got signed off probably also explains why Ford is now in the same category with Stellantis in China rather than in the same peer group as VW, Hyundai, or Toyota.

 

Jiangling Ford, the once forgotten backwater of Ford China that expat Ford executives don't want to have anything to do with, is starting to look like a much more successful operation than flagship Chang'an Ford, which is just sabotaged by constant stream of bad decisions on product, sales, marketing etc. 

[Oac98]

On 8/4/2023 at 7:16 PM, jpd80 said:

Precisely, 77 sales in June, 268 for H1 shows how Ford has been hiding the truth.

Chinese buyers have moved on and this dog just won’t hunt.

 

I think time has run out for Mach E in China and transferring it to the local, Changan is a sign that Ford wants its costs gone form its books. So it’s fairly safe to predict that it will be gone in the near future, maybe it will be rebranded/repurposed as a lower cost  BEV to finish out any costs owed on the original project.

 

The lack lustre sales in North America with growing inventory tells us that buyers are balking at what Ford has as available stock.

I can’t help but be extremely concerned about these terrible Mach-E sales in N/A and China. Since my plant is supposed to get two mystery EV crossovers I have every right to be concerned with these dismal sales. I know it’s still two years away before these products even see a dealer but unless things start changing I fear the products might FLOP.  I know it’s too early to jump the gun here, after the contract and when ford changes their plans once again there may be some more clarity.  There is also a rumor going around at the plant that the lame duck Edge may get extended til the end of May 2024 now from the March cancellation time. This information which could be false came from someone who works at a supplier. Anyways I’m rambling on the bottom line is this EV transition has a long long way to go.  The Mach-E is a nice product but too me it’s too expensive.

[tbone]

58 minutes ago, Oacjay98 said:

I can’t help but be extremely concerned about these terrible Mach-E sales in N/A and China. Since my plant is supposed to get two mystery EV crossovers I have every right to be concerned with these dismal sales. I know it’s still two years away before these products even see a dealer but unless things start changing I fear the products might FLOP.  I know it’s too early to jump the gun here, after the contract and when ford changes their plans once again there may be some more clarity.  There is also a rumor going around at the plant that the lame duck Edge may get extended til the end of May 2024 now from the March cancellation time. This information which could be false came from someone who works at a supplier. Anyways I’m rambling on the bottom line is this EV transition has a long long way to go.  The Mach-E is a nice product but too me it’s too expensive.

They could probably do another exterior refresh and update the interior and get another couple of years out of the Edge.  It’s getting pretty long in the tooth otherwise.  The people I know that have them do like them though. 

[jpd80]

Mach E is done in China, no matter if Ford does this or the market does that, buyers have moved on.

Absolutely screwed the pooch on this one but guess what, no one will get fired…….

[Oac98]

5 hours ago, tbone said:

They could probably do another exterior refresh and update the interior and get another couple of years out of the Edge.  It’s getting pretty long in the tooth otherwise.  The people I know that have them do like them though. 

It’s likely still done next year in its current form. They did say second quarter 2024 to retool for all I know they can stretch it til next July shutdown. 

[akirby]

8 hours ago, tbone said:

They could probably do another exterior refresh and update the interior and get another couple of years out of the Edge.  It’s getting pretty long in the tooth otherwise.  The people I know that have them do like them though. 

Nowhere to put it.  Edge and Nautilus are great vehicles.  I think the C2 version with a hybrid powertrain would work well and be far more profitable.  Maybe they should cancel Escape and build C2 edge and Nautilus in Louisville.

[Oac98]

58 minutes ago, akirby said:

Nowhere to put it.  Edge and Nautilus are great vehicles.  I think the C2 version with a hybrid powertrain would work well and be far more profitable.  Maybe they should cancel Escape and build C2 edge and Nautilus in Louisville.

Although Oakville is being retooled it still pisses me off that these vehicles were not electrified or upgraded at this plant. I hope these BEV products are worth losing the Edge and Nautilus here. I thought the Edge was being removed because Ford has too many 2 row crossovers. 

[akirby]

10 minutes ago, Oacjay98 said:

Although Oakville is being retooled it still pisses me off that these vehicles were not electrified or upgraded at this plant. I hope these BEV products are worth losing the Edge and Nautilus here. I thought the Edge was being removed because Ford has too many 2 row crossovers. 

2 row crossovers have more competition and don’t yield as much profit as other vehicles so when it came time to cut something to make room for BEVs they were at the top of the list.  I wish they had moved them to C2 back in 2018 with hybrids.  It might have changed the outcome.  Being stuck on CD3 just made the decision a no brainer.

[rperez817]

6 hours ago, jpd80 said:

Mach E is done in China, no matter if Ford does this or the market does that, buyers have moved on.

Absolutely screwed the pooch on this one but guess what, no one will get fired…….

 

Very true jpd80, and very sad. Jim Farley wasn't exaggerating when he said that Chinese automakers are Ford's biggest rivals nowadays. Not just in the China domestic market, but globally. Thanks to their rapid progress with BEV, earlier this year China overtook Japan as the biggest exporter of automobiles in the world. Powered by electric vehicle growth, China overtakes Japan as biggest auto exporter | TechCrunch

 

Quote

As one EV consultant told me recently: "There are only two types of EV companies in the world: Tesla, or Chinese EV makers."

Edited August 8, 2023 by rperez817

[Oac98]

1 hour ago, akirby said:

2 row crossovers have more competition and don’t yield as much profit as other vehicles so when it came time to cut something to make room for BEVs they were at the top of the list.  I wish they had moved them to C2 back in 2018 with hybrids.  It might have changed the outcome.  Being stuck on CD3 just made the decision a no brainer.

Yes they’re on an older platform and they should’ve been hybrid and on a better platform. They cancel them then all of a sudden a hybrid Nautilus is coming from China. Let’s see how much their BEV plans change. Which I expect they will!

[Rick73]

1 hour ago, Oacjay98 said:

Yes they’re on an older platform and they should’ve been hybrid and on a better platform. They cancel them then all of a sudden a hybrid Nautilus is coming from China. Let’s see how much their BEV plans change. Which I expect they will!

A lot of people still think hybrids have no future, not even to smooth out transition, and that making them available just delays BEV adoption.  It appears buyers want what they want, but more importantly, not a single person I know appreciates being told what they should like.

 

I can understand why CEOs a few years ago made decisions that haven’t quite worked out as expected.  Buyer resistance, higher BEV prices, and high interest rates were probably not anticipated accurately.  Now they are adjusting to different conditions the best they can. 

[Oac98]

I agree with you great points!

[rmc523]

6 hours ago, akirby said:

Nowhere to put it.  Edge and Nautilus are great vehicles.  I think the C2 version with a hybrid powertrain would work well and be far more profitable.  Maybe they should cancel Escape and build C2 edge and Nautilus in Louisville.

 

Are you talking about the Chinese version?  I don't think it'd do well - it doesn't look good, and more importantly is a different form factor than the Edge (more upright than Edge has ever been).

[Oac98]

2 hours ago, Rick73 said:

A lot of people still think hybrids have no future, not even to smooth out transition, and that making them available just delays BEV adoption.  It appears buyers want what they want, but more importantly, not a single person I know appreciates being told what they should like.

 

I can understand why CEOs a few years ago made decisions that haven’t quite worked out as expected.  Buyer resistance, higher BEV prices, and high interest rates were probably not anticipated accurately.  Now they are adjusting to different conditions the best they can. 

The amount of money being pumped into this EV transition by these governments and corporations it would be a catastrophe if it fails. I believe EVs are here to stay it’s just gonna take time like we all know. 

[silvrsvt]

3 hours ago, Rick73 said:

A lot of people still think hybrids have no future, not even to smooth out transition, and that making them available just delays BEV adoption.  It appears buyers want what they want, but more importantly, not a single person I know appreciates being told what they should like.

 

I can understand why CEOs a few years ago made decisions that haven’t quite worked out as expected.  Buyer resistance, higher BEV prices, and high interest rates were probably not anticipated accurately.  Now they are adjusting to different conditions the best they can. 

 

So Ford sets a goal of selling 600k EVs worldwide (out of 4.2 million sold in 2022 or roughly 14%) for this year and pushes it back 6-12 months is a catastrophic failure because of the lack hybrids? As because of a short/near term problems that are affecting them? 

 

The thing is hybrid products will be added still just like new EV products will be, but long term hybrids alone will not fix or meet CAFE or other government regulations around the world either. 

 

[akirby]

1 hour ago, rmc523 said:

 

Are you talking about the Chinese version?  I don't think it'd do well - it doesn't look good, and more importantly is a different form factor than the Edge (more upright than Edge has ever been).

No I meant a NA Edge similar to the current one here.

Edited August 8, 2023 by akirby

[tbone]

11 hours ago, Oacjay98 said:

Yes they’re on an older platform and they should’ve been hybrid and on a better platform. They cancel them then all of a sudden a hybrid Nautilus is coming from China. Let’s see how much their BEV plans change. Which I expect they will!

Admittedly, I am not an earlier adopter type, so the BEV situation doesn’t impact me.  However, there has been a really interesting slow down in the BEV market, and I would really hate to be decision maker in this current market environment. There appears to me to be a significant amount of instability in the BEV market right now and I’m not sure how that is going to play out yet. 

[jpd80]

Ford took a punt with Edge and developed a 2.0 diesel version for Europe that sold poorly. Had it invested in hybrid with batteries under passenger seat like C2, things may have worked out differently. Edge is basically a ‘bigger Escape’ which I think would have probably been preferred by more buyers - maybe with starting price between the two…..,

[jasonj80]

9 hours ago, jpd80 said:

Ford took a punt with Edge and developed a 2.0 diesel version for Europe that sold poorly. Had it invested in hybrid with batteries under passenger seat like C2, things may have worked out differently. Edge is basically a ‘bigger Escape’ which I think would have probably been preferred by more buyers - maybe with starting price between the two…..,

That powertrain was also going to be offered in the US version at one point; Then VW happened.

The problem with the Edge Hybrid was always that when they used an I4 it was under powered and if they used the V6 they didn't hit the mileage numbers they needed.

 

Ford needed more than just the Mach-e in the electric car space for China; A lower cost sedan would go a long way in the Chinese market.
 

[jpd80]

7 hours ago, jasonj80 said:

That powertrain was also going to be offered in the US version at one point; Then VW happened.

The problem with the Edge Hybrid was always that when they used an I4 it was under powered and if they used the V6 they didn't hit the mileage numbers they needed.

 

Ford needed more than just the Mach-e in the electric car space for China; A lower cost sedan would go a long way in the Chinese market.
 

As it turns out the 2.0 diesel was a good one to avoid, Ford is having issues with a lot of diesel ending up in engine oil, a problem they can’t seem to fix. The only way to avoid the premature failures being seen in Transit and some Rangers is strict adherence to routine oil changes. It’s either leaking injectors or some sort of leak on the high pressure pump.

 

The problem with an Edge hybrid stems entirely from the CD3 platform being a lot heavier than a similar  vehicle on C2, that’s where the issue with the I-4 being underpowered starts and finishes (a 2” or 3” wider Escape could have replaced both vehicles) but Ford was looking at least changes required. In the end that RWD CD4 Edge that failed sucked up all the funding and time.

Edited August 9, 2023 by jpd80