It still seems like getting rid of the Fusion was a mistake.

[ExplorerDude]

There is definitely a sizable group internally that hate that the Fusion was dropped. It was a very competitive car and had a fairly clean and successful reputation. Many of those people worked really hard on the Fusion and were all shocked how Ford just walked away.
 

Dropping the Fusion and all of the sedans eliminated a money losing business. Everyone is happy that the replacement products that took sedans place which people are passionate about (Bronco, Ranger, Bronco Sport, Maverick, and Mustang Mach-E) are money makers.

But many are upset that Ford abandoned a still sizable segment and doesn’t have at least one entry in that fight. We have lost a lot of customers who walked away from Ford because of zero sedans. Heck many of them would have bought any size Ford sedan just to have a new sedan. It’s a tough pill to swallow.

 

Hackett didn’t want to make that decision, it was a “hot potato” topic. So he tossed it to Farley and he extinguished it. Farley claimed it was the hardest decision of his career.

[jpd80]

1 hour ago, slemke said:

Might not be “massive “ but Ford is trying to close out ‘23 Lightning with $7500 incentives on xlt and lariat.  Inventory of pro and platinum must be under control as those were excluded.

I wonder if the Pro and platinum versions are basically made to customer orders……..

[jpd80]

8 hours ago, silvrsvt said:

 

In the Bring back Bronco podcast, they had about 3 different attempts to Bring the Bronco back post 1996

 

One was killed due to the Firestone tire fiscao 

 

The other one was killed by the increase gas prices and then the 2007-2008 Economic recession. 

For sure, multiple attempts to bring it back, given where Ford was financially in the early and late 2000s, no wonder it didn’t get a start

 

Maverick is what FNA wanted when T6 product envelope  was discussed in late 2006, we can see why it was never going to work, C1/C2 was always a better plan

 

8 hours ago, akirby said:

It was also a difficult standalone business case until they decided to drop focus and bring back Ranger.

Absolutely and as above FNA asked for the wrong vehicle on T6 kick off in 2006, Bronco would have given T6 development way more latitude with seizing parameters at the very start but 2006 is when Ford funding was extremely tight.

 

Conversely, imagine Maverick built at Wayne instead of C1 Focus…….yeah I know20/20 hindsight ? 

[Trader 10]

1 hour ago, ExplorerDude said:

Dropping the Fusion and all of the sedans eliminated a money losing business. Everyone is happy that the replacement products that took sedans place which people are passionate about (Bronco, Ranger, Bronco Sport, Maverick, and Mustang Mach-E) are money makers.

Mach E is a huge money loser. 

[akirby]

12 minutes ago, Trader 10 said:

Mach E is a huge money loser. 

Are you sure?  

[Trader 10]

14 minutes ago, akirby said:

Are you sure?  

Yep. If you have any doubts check out Ford’s Model E financials. By the way, I notice my local dealer group is offering rebates on all 12 of its Mach E’s in stock. $4250 to $9250. 

[akirby]

42 minutes ago, Trader 10 said:

Yep. If you have any doubts check out Ford’s Model E financials. By the way, I notice my local dealer group is offering rebates on all 12 of its Mach E’s in stock. $4250 to $9250. 

Model E financials have nothing to do with whether Mach-E itself is turning a profit.  And rebates make it less likely but some people have inside information we don’t have.

[DeluxeStang]

2 hours ago, ExplorerDude said:

There is definitely a sizable group internally that hate that the Fusion was dropped. It was a very competitive car and had a fairly clean and successful reputation. Many of those people worked really hard on the Fusion and were all shocked how Ford just walked away.
 

Dropping the Fusion and all of the sedans eliminated a money losing business. Everyone is happy that the replacement products that took sedans place which people are passionate about (Bronco, Ranger, Bronco Sport, Maverick, and Mustang Mach-E) are money makers.

But many are upset that Ford abandoned a still sizable segment and doesn’t have at least one entry in that fight. We have lost a lot of customers who walked away from Ford because of zero sedans. Heck many of them would have bought any size Ford sedan just to have a new sedan. It’s a tough pill to swallow.

 

Hackett didn’t want to make that decision, it was a “hot potato” topic. So he tossed it to Farley and he extinguished it. Farley claimed it was the hardest decision of his career.

Yeah, really a losing situation either way. I can understand why Ford cut the focus and fiesta, but it seems kind of insane to get rid of all your midsized sedan for a segment that still sells millions of cars a year. I understand the fusion wasn't profitable, and sales volume doesn't matter much if you're losing money on each car you sell. But the c2 mondeo is almost certainly profitable, Ford should take a hard look at bringing that here. 

[DeluxeStang]

1 hour ago, Trader 10 said:

Mach E is a huge money loser. 

I'm pretty sure someone who clearly works for Ford at a relatively high level has a better understanding of what products are profitable or not. That Palmer dude essentially implied the mach-e was almost immediately profitable. 

[akirby]

42 minutes ago, DeluxeStang said:

Yeah, really a losing situation either way. I can understand why Ford cut the focus and fiesta, but it seems kind of insane to get rid of all your midsized sedan for a segment that still sells millions of cars a year. I understand the fusion wasn't profitable, and sales volume doesn't matter much if you're losing money on each car you sell. But the c2 mondeo is almost certainly profitable, Ford should take a hard look at bringing that here. 

Mondeo is a premium vehicle.  Chinese Taurus and Zephyr might be better choices and could be built in flat rock but that depends on what they have planned for FR.

[silvrsvt]

Speaking of the Mach E being profitable-thought this was interesting

Edited October 16, 2023 by silvrsvt

[Flying68]

1 hour ago, silvrsvt said:

Speaking of the Mach E being profitable-thought this was interesting

Shows that the Rivian Van and MachE have the lowest cost per kWh at $98.50 with LFP batteries.  The Caddy and Ram are next at $112.70 and $112.90 (almost identical) with NCM variants.  The Model S is $120.30 with an NCA battery.  Curious if that is the actual capacity though, Tesla is very non-specific about their battery capacity.  Last is the ID.4 at $140.81, but with such a small battery size I wonder if there is some scaling issue there as the BMS and cooling are probably a bigger cost component.  I would have assumed with a NCM variant that the cost would have been closer to the Caddy and Ram.

[bzcat]

I mentioned is a couple of pages back. It is almost certain that Ford is making decent if not great profit margin on Mach E. Most OEM are rapidly achieving cost parity between ICE and EV so if they can make gross profit on a similar price ICE, they are almost certainly doing so on the EV. This doesn't even consider the impact of Govt subsidy which has the effect of allowing OEM to mark up the price on EV.  

 

The Model E division is still losing money but it is due to the overhead cost (mainly R&D and engineering). 

 

15 hours ago, DeluxeStang said:

Yeah, really a losing situation either way. I can understand why Ford cut the focus and fiesta, but it seems kind of insane to get rid of all your midsized sedan for a segment that still sells millions of cars a year. I understand the fusion wasn't profitable, and sales volume doesn't matter much if you're losing money on each car you sell. But the c2 mondeo is almost certainly profitable, Ford should take a hard look at bringing that here. 

 

I don't think that is a guarantee that C2 Mondeo is profitable. 

 

The thing you have to consider is opportunity costs... Ford North America and Europe had fully occupied plants so bring in Mondeo would mean displacing another potentially more profitable product. 

 

Ford China had the opposite problem... it has too much capacity so it has to find some product to fill. Ford has contractual requirements to keep these plants open due to JV with Chang'an so Ford is willing to accept lower profit margin on some product just to keep the plant churning. Ford expanded its production footprint in China when Focus was the #1 selling vehicle in China and it couldn't keep up with demand. The wheels have fallen off the wagon since that time and it has probably twice as much production capacity as it can sell. Ford has 7 plants in China and 5 of them is Chang'an Ford and 2 is Jiangling Ford:

 

Chang'an Chongqing 1: C2 Mondeo/Evos/Zephyr

Chang'an Chongqing 2: C2 Escape, Focus

Chang'an Chongqing 3: C1 Escort, MACH E

Chang'an Hangzhou: C2 Edge L/Nautilus

Chang'an Harbin: C2 Focus, Explorer/Aviator

Jiangling Nanchang: Baodian, Yuhu, Dadao, Ranger, Everest, Bronco (planned), Territory, Yusheng S350, Equator Sport, Equator

Jiangling Xiaolan: Transit, Transit Pro, Tourneo, Teshun, Fushun, medium duty cab forward

 

As you can see, Jiangling Ford has a much more efficient utilization of its plant resources, mostly because Ford has more control over this business. Chang'an is a much bigger company and their goal with Chang'an Ford is the extract maximum rent from Ford so they won't agree to shutting down plants that are clearly not needed. 

 

Farley has already mentioned that Ford China could become an export focus production hub (like Ford Thailand) if things don't turn around in China soon. 

Edited October 16, 2023 by bzcat

[Rick73]

5 hours ago, Flying68 said:

Shows that the Rivian Van and MachE have the lowest cost per kWh at $98.50 with LFP batteries.  The Caddy and Ram are next at $112.70 and $112.90 (almost identical) with NCM variants.  The Model S is $120.30 with an NCA battery.  Curious if that is the actual capacity though, Tesla is very non-specific about their battery capacity.  Last is the ID.4 at $140.81, but with such a small battery size I wonder if there is some scaling issue there as the BMS and cooling are probably a bigger cost component.  I would have assumed with a NCM variant that the cost would have been closer to the Caddy and Ram.

At around $100/kWh, I doubt above costs include the entire battery pack with BMS and cooling, etc.  If so, manufacturers are making a killing on price premium for extended-range options.  Granted, some manufacturers also include other upgrades with larger batteries, but I doubt $100/kWh is realistic today.  The most recent data I saw for cell costs alone make above estimates seem optimistic IMO.

[bzcat]

2 hours ago, Rick73 said:

At around $100/kWh, I doubt above costs include the entire battery pack with BMS and cooling, etc.  If so, manufacturers are making a killing on price premium for extended-range options.  Granted, some manufacturers also include other upgrades with larger batteries, but I doubt $100/kWh is realistic today.  The most recent data I saw for cell costs alone make above estimates seem optimistic IMO.

 

Battery cell prices is definitely in the $100 kwh range now and falling. I work for a company that is in the energy sector and I deal with battery pricing weekly. 

 

Lithium prices dropped about 50~60% since the start of 2023 and we are now seeing some forward contracts below $90 per kwh. 2021-2022 was an anomaly when the price went up. But everything was going nuts during the height of COVID pandemic.

 

 

 

[ExplorerDude]

13 hours ago, Georggg said:

Ford's challenge with small cars was that they invested in the production of three models, including the Fiesta and Focus (excluding the STs and RS), which were primarily sold based on their low, and often unprofitable, pricing. Ford's response to this "small car problem" was to discontinue all three models in the United States. This decision came despite the Fusion, which was selling at higher and more profitable price points.

 

In contrast, General Motors (GM) took a more prudent approach and retained the Malibu in their lineup. They recognized that the engineering and tooling costs had already been covered, making it a wise decision to continue offering the Malibu. As a result, GM now sells over 100,000 Malibus annually with minimal effort, while Ford has shifted its focus towards two-row SUVs, entering a competitive yet not necessarily highly profitable market.

Yes and as far as I know, the Malibu is rumored to be getting a top hat redesign for 2025 or 2026. 
 

This is the approach Ford should have taken but here we are.

[bzcat]

15 hours ago, Georggg said:

Ford's challenge with small cars was that they invested in the production of three models, including the Fiesta and Focus (excluding the STs and RS), which were primarily sold based on their low, and often unprofitable, pricing. Ford's response to this "small car problem" was to discontinue all three models in the United States. This decision came despite the Fusion, which was selling at higher and more profitable price points.

 

In contrast, General Motors (GM) took a more prudent approach and retained the Malibu in their lineup. They recognized that the engineering and tooling costs had already been covered, making it a wise decision to continue offering the Malibu. As a result, GM now sells over 100,000 Malibus annually with minimal effort, while Ford has shifted its focus towards two-row SUVs, entering a competitive yet not necessarily highly profitable market.

 

GM only kept the car in production because UAW contract requires them to keep a full shift at Fairfax assembly plant (Cadillac XT4 by itself couldn't get enough utilization). Where they had other CUV ready to replace the car production in North America (Sonic, Impala) or is able to close the plant because they found a buyer (Cruze), they did what Ford did:

• Orion (Sonic) converted to building EV
• Lordstown (Cruze) sold
• Ramos Arizpe (Cruze) converted to building Equinox and Blazer and EV next year
• Oshawa (Impala) converted to building Silverado
• Fairfax (Malibu) maintained to keep plant utilization which builds another low volume product XT4 

 

The new Malibu will probably be imported from Korea where all the low margin GM products are sourced. There is no indication that GM will continue to build it here since Fairfax plant is supposedly on the chopping block as part of the current UAW negotiation. If Ford had an overseas production site with low cost bases that can produce sedans and not subject to any tariffs, they probably would have imported some cars. They had plan to import Focus from China (and maybe Fusion too who knows) until we slapped 25% tariff on Chinese built cars. We covered this already a few pages back.

Edited October 17, 2023 by bzcat

[Footballfan]

5 hours ago, bzcat said:

 

GM only kept the car in production because UAW contract requires them to keep a full shift at Fairfax assembly plant (Cadillac XT4 by itself couldn't get enough utilization). Where they had other CUV ready to replace the car production in North America (Sonic, Impala) or is able to close the plant because they found a buyer (Cruze), they did what Ford did:

• Orion (Sonic) converted to building EV
• Lordstown (Cruze) sold
• Ramos Arizpe (Cruze) converted to building Equinox and Blazer and EV next year
• Oshawa (Impala) converted to building Silverado
• Fairfax (Malibu) maintained to keep plant utilization which builds another low volume product XT4 

 

The new Malibu will probably be imported from Korea where all the low margin GM products are sourced. There is no indication that GM will continue to build it here since Fairfax plant is supposedly on the chopping block as part of the current UAW negotiation. If Ford had an overseas production site with low cost bases that can produce sedans and not subject to any tariffs, they probably would have imported some cars. They had plan to import Focus from China (and maybe Fusion too who knows) until we slapped 25% tariff on Chinese built cars. We covered this already a few pages back.

The new Malibu's scheduled to continue at Fairfax.  There's no way that gm would think of- and the UAW would not even consider- allowing a plant to close. In fact, the right to strike over plant closings is going to be part of the new contract. 

[AGR]

6 hours ago, bzcat said:

 

GM only kept the car in production because UAW contract requires them to keep a full shift at Fairfax assembly plant (Cadillac XT4 by itself couldn't get enough utilization). Where they had other CUV ready to replace the car production in North America (Sonic, Impala) or is able to close the plant because they found a buyer (Cruze), they did what Ford did:

• Orion (Sonic) converted to building EV
• Lordstown (Cruze) sold
• Ramos Arizpe (Cruze) converted to building Equinox and Blazer and EV next year
• Oshawa (Impala) converted to building Silverado
• Fairfax (Malibu) maintained to keep plant utilization which builds another low volume product XT4 

 

The new Malibu will probably be imported from Korea where all the low margin GM products are sourced. There is no indication that GM will continue to build it here since Fairfax plant is supposedly on the chopping block as part of the current UAW negotiation. If Ford had an overseas production site with low cost bases that can produce sedans and not subject to any tariffs, they probably would have imported some cars. They had plan to import Focus from China (and maybe Fusion too who knows) until we slapped 25% tariff on Chinese built cars. We covered this already a few pages back.

 

Or, maybe GM found that after Ford and Stellantis dropped their midsize sedans, they had the market to themselves and could make a profit on the Malibu. Since they're going to have at least one more generation of the ICE Malibu(rumored to be followed by an EV Malibu), that's more likely than your scenario.

And that is the second time in this thread that you have stated that totally unsubstantiated speculation about the next Malibu coming from Korea, no doubt pulled from your nether regions.

[silvrsvt]

7 hours ago, AGR said:

And that is the second time in this thread that you have stated that totally unsubstantiated speculation about the next Malibu coming from Korea, no doubt pulled from your nether regions.

 

More often then not they are correct with their information. Fairfax is the odd man out with product.

 

https://cdn.motor1.com/pdf-files/programdirnam.pdf

 

According to this, the Malibu might be moving to a new platform that is shared with the Traverse and other large CUVs that GM has. 

[rperez817]

On 10/15/2023 at 7:56 PM, ExplorerDude said:

We have lost a lot of customers who walked away from Ford because of zero sedans. Heck many of them would have bought any size Ford sedan just to have a new sedan.

 

A tiny sliver of that customer base consists of Ford "sheeple" customers who would pay top dollar just to have a sedan with the Blue Oval on it, but the vast majority are those who bought a new Ford sedan for the deal, not because the product was a sedan or a Ford.

 

If such customers are worth keeping in the Ford "family", Ford can direct them to certified pre-owned cars at Ford dealerships, for example via the Blue Advantage program. Shop Ford Blue Advantage Certified Used Vehicles 

Edited October 18, 2023 by rperez817

[Chrisgb]

24 minutes ago, rperez817 said:

 

A tiny sliver of that customer base consists of Ford "sheeple" customers who would pay top dollar just to have a sedan with the Blue Oval on it, but the vast majority are those who bought a new Ford sedan for the deal, not because the product was a sedan or a Ford.

 

If such customers are worth keeping in the Ford "family", Ford can direct them to certified pre-owned cars at Ford dealerships, for example via the Blue Advantage program. Shop Ford Blue Advantage Certified Used Vehicles 

That sounds overly simplistic to me. I've been out of the car biz for nearly thirty years now,; mostly Ford but a GM P-O-C and a Mopar 6-pack as well. And it was nearly impossible to put a customer in a low-milage rental/lease return/repo even if it was nicer equipped for the same or less money than a new one that we didn't have or couldn't dealer trade for. The marketplace may be more homogenized nowadays; fewer "Ford guys vs Chevy guys" outside of trucks. But if a Ford sedan debuted, I believe a good number of Camry and Sonata buyers would come back, and if done right, conquest sales.

[rperez817]

13 minutes ago, Chrisgb said:

But if a Ford sedan debuted, I believe a good number of Camry and Sonata buyers would come back, and if done right, conquest sales.

 

The "if done right" part is why Ford won't debut an ICE powered sedan in the U.S. The opportunity costs associated with doing it right are much too high.

[akirby]

No way Malibu is making much profit.  It’s only being kept around to keep the plant open u til they find something better to build.

 

 

[AGR]

On 10/18/2023 at 6:59 AM, silvrsvt said:

 

More often then not they are correct with their information. Fairfax is the odd man out with product.

 

https://cdn.motor1.com/pdf-files/programdirnam.pdf

 

According to this, the Malibu might be moving to a new platform that is shared with the Traverse and other large CUVs that GM has. 

 

GM Begins Planning Next-Gen, 2025 Chevy Malibu: Exclusive (gmauthority.com)

 

Let the attack-the-source and/or GM-is-stupid posts begin...