Detroit Three automakers should exit China, leading analyst says

[tbone]

A thought provoking story:

 

Legacy U.S. automakers such as Ford Motor and General Motors should leave the China market to preserve capital amid the costly electric vehicle (EV) transition,… 
 Source: Reuters

 

https://www.reuters.com/business/autos-transportation/detroit-three-automakers-should-exit-china-leading-analyst-says-2024-06-18/

[rmc523]

It could be argued that they never should've gone in the first place with the Chinese partner (take your designs/knowledge) requirement.

[AM222]

Currently, Ford's most affordable volume SUV models in Asia and South America are from China.

[mackinaw]

Remember Pioneer, who worked at DAP?  He long argued that Ford should pull out of China.  I think he left BON because all the flack he took for his views.

[akirby]

50 minutes ago, mackinaw said:

Remember Pioneer, who worked at DAP?  He long argued that Ford should pull out of China.  I think he left BON because all the flack he took for his views.

He started bitching about everything and essentially begging the moderators to ban him.  The last thing I remember is he got his panties in a wad about which forum things should be posted in then just started name calling.  

[mackinaw]

41 minutes ago, akirby said:

He started bitching about everything and essentially begging the moderators to ban him.  The last thing I remember is he got his panties in a wad about which forum things should be posted in then just started name calling.  

 

You're right, he was a first-class pain in the end.  Too bad, because he offered some pretty good insight on occasion.  

[rmc523]

1 hour ago, akirby said:

He started bitching about everything and essentially begging the moderators to ban him.  The last thing I remember is he got his panties in a wad about which forum things should be posted in then just started name calling.  

 

Wasn't he one of the ones hellbent that Lincoln topics didn't belong in the Ford Motor Company area?

[akirby]

46 minutes ago, mackinaw said:

 

You're right, he was a first-class pain in the end.  Too bad, because he offered some pretty good insight on occasion.  

I bought a F150 the month after he left and a few months later he started attacking me when I started posting at F150forum.com.  Serious mental health issues.

[akirby]

9 minutes ago, rmc523 said:

 

Wasn't he one of the ones hellbent that Lincoln topics didn't belong in the Ford Motor Company area?

That was it.  And he got mad when I moved one of his topics about GM to the Competing Products forum because we didn’t move Lincoln topics to the Lincoln forum.  Petulant 2 yr old.

[92merc]

So back on Topic.  Is Ford actually making money in China?  Enough to add to their bottom line?

 

If not, get out while you can is my opinion.

[mackinaw]

31 minutes ago, 92merc said:

So back on Topic.  Is Ford actually making money in China?  Enough to add to their bottom line?

 

If not, get out while you can is my opinion.

 

They were losing money, but have been profitable the past three quarters.  

 

It's behind a paywall, but here's the link.

 

https://fortune.com/2024/06/19/elon-musk-tesla-china-carmakers-gm-ford-stellantis-bank-of-america/

[Andrew L]

Oof if Ford were to exit China that would pretty much be the death of Lincoln wouldn't it?

[ausrutherford]

50 minutes ago, Andrew L said:

Oof if Ford were to exit China that would pretty much be the death of Lincoln wouldn't it?

 

Correct...and Buick. 

 

And Ford of Australia that works on Chinese models, and Ford Taiwan and Ford Vietnam that get CKD kits from China. The domino effect would be hard on sales elsewhere. 

 

Then there is JMC, which has launched in dozens of nations as well. 

[tbone]

14 hours ago, rmc523 said:

It could be argued that they never should've gone in the first place with the Chinese partner (take your designs/knowledge) requirement.

I would argue this position in hindsight. Think about all the intellectual property that Ford exposed by the mandatory partnering with the Chinese company. The American companies that have chosen to do business in China are in part responsible for their advancements commercially and militarily.  I would ask if the cost was worth the access to the market.

[jpd80]

7 hours ago, ausrutherford said:

 

Correct...and Buick. 

 

And Ford of Australia that works on Chinese models, and Ford Taiwan and Ford Vietnam that get CKD kits from China. The domino effect would be hard on sales elsewhere. 

 

Then there is JMC, which has launched in dozens of nations as well. 

No, Ford China doing its own vehicle development now…

 

At the moment, Ford AUS engineering is tied up on T6 project but 

body/trim design and development has been transferred to India,

chassis development is probably finished at the end of the year…

[92merc]

I"m not saying Ford would quit building vehicles for export.  Just quit selling Fords in China.

[rmc523]

2 hours ago, 92merc said:

I"m not saying Ford would quit building vehicles for export.  Just quit selling Fords in China.

 

What's the point of that?

[92merc]

Cheaper Chinese labor.

[atomcat68]

On 6/19/2024 at 8:47 PM, ausrutherford said:

 

Correct...and Buick. 

 

And Ford of Australia that works on Chinese models, and Ford Taiwan and Ford Vietnam that get CKD kits from China. The domino effect would be hard on sales elsewhere. 

 

Then there is JMC, which has launched in dozens of nations as well. 

I think that GM's partner, SIAC would probably buy the Buick brand from them and it would disappear from the USA, but would revive in China as it would be in Chinese hands. This is what happened with MG from the UK.

 

Lincoln would absolutely die. Maybe it would be a trim level for Ford, but If I were running Ford, I'd seriously consider pulling the plug on Lincoln.

[atomcat68]

Other than Lincoln, I think Ford and all American companies should get out of the retreat mindset and stop trying to cut their way to prosperity. There is a reason why Toyota has so much success and it's not because they run away from a problem screaming every time something goes bad. They learn, improve and move forward instead of cut product, retreat from markets, and make things cheaper quality to pad profit.

[akirby]

17 minutes ago, atomcat68 said:

Other than Lincoln, I think Ford and all American companies should get out of the retreat mindset and stop trying to cut their way to prosperity. There is a reason why Toyota has so much success and it's not because they run away from a problem screaming every time something goes bad. They learn, improve and move forward instead of cut product, retreat from markets, and make things cheaper quality to pad profit.

Hmm….

 

New since 2019.    Maverick.  Bronco Sport.  Ranger.  Bronco.  Lightning.  Mach-E.  E transit.

 

Discontinued.   Fusion.  Edge.  Focus.  Ecosport.  Taurus.  Continental.  MKZ.  Transit Connect.

 

In development.  2 new 3 row EVs.  3 new affordable EVs.  T3 pickup.

 

Unchanged.  F series.  Mustang.  Escape.  Corsair.  Expedition.  Navigator.  Nautilus.  Transit.

 

Thats not cutting its just swapping products and adding new products.

[jpd80]

Initially, I had this false idea that Ford China was going to be this huge generator of low cost

Ford vehicles that would be exported across most Asian and southern hemisphere markets.

Since pre Mulally times, Ford has shown total ineptitude in its ability to crack the Chinese market

let alone even think about supplying potentially lucrative export markets, no doubt Ford Europe

jealously guards it’s ROW sales even when it’s unable to supply them….what a cluster F***.

 

As bad as that might seem, I would rather  be in Ford’s financial shoes than Stellantis,

I think they’re in deep trouble with the CEO calling for a $200 M haircut of US staff.

Edited June 21, 2024 by jpd80

[atomcat68]

31 minutes ago, akirby said:

Hmm….

 

New since 2019.    Maverick.  Bronco Sport.  Ranger.  Bronco.  Lightning.  Mach-E.  E transit.

 

Discontinued.   Fusion.  Edge.  Focus.  Ecosport.  Taurus.  Continental.  MKZ.  Transit Connect.

 

In development.  2 new 3 row EVs.  3 new affordable EVs.  T3 pickup.

 

Unchanged.  F series.  Mustang.  Escape.  Corsair.  Expedition.  Navigator.  Nautilus.  Transit.

 

Thats not cutting its just swapping products and adding new products.

Market share from 14.7 in 2015  percent to 13. Also we discuss constantly about cutting costs for short term profit, but over the long haul causing more loss with recalls and quality problems. There has been points that Ford concentrates on more profitable models, but that let them to having a glut of overly expensive products sitting on lots for too many days. Also look at Ford pulling out of markets over the globe. They are making their worldwide presence smaller.

 

Toyota doesn't do any of this for the most part. They increase market share, stay in markets across the globe, add products without abandoning old ones, and no one can argue that they are a stronger, more profitable company. There is no shame in stating Ford's shortcomings, as long as they can learn and grow. 

 

The new products Ford added are nice, but the question on the topic is if Ford should leave China, which I say they should not. They should learn and adapt and not run away, because pulling out of markets will make then too small and unable to adapt. If they retreat to just a few markets, the competitors they ran from will eventually come here on the home turf and set up shop. 

 

 

[Sherminator98]

27 minutes ago, atomcat68 said:

Market share from 14.7 in 2015  percent to 13. Also we discuss constantly about cutting costs for short term profit, but over the long haul causing more loss with recalls and quality problems. There has been points that Ford concentrates on more profitable models, but that let them to having a glut of overly expensive products sitting on lots for too many days. Also look at Ford pulling out of markets over the globe. They are making their worldwide presence smaller.

 

Toyota doesn't do any of this for the most part. They increase market share, stay in markets across the globe, add products without abandoning old ones, and no one can argue that they are a stronger, more profitable company. There is no shame in stating Ford's shortcomings, as long as they can learn and grow. 

 

Toyota is far larger in emerging markets that may or may not be as profitable and exist in a market that is even well more protected then the US market is. They are also starting to run into a reckoning with some fairly large issues that have come to light in the past few months. 

[AM222]

On 6/20/2024 at 8:47 AM, ausrutherford said:

 

Correct...and Buick. 

 

And Ford of Australia that works on Chinese models, and Ford Taiwan and Ford Vietnam that get CKD kits from China. The domino effect would be hard on sales elsewhere. 

 

Then there is JMC, which has launched in dozens of nations as well. 

This year, JMC-Ford's Territory landed in South Africa, its first right-hand drive market. More to come? India perhaps?
It's also interesting to point out that Ford owns 32% of JMC.