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@Bloggin is saying if you fail to plan long term, You will fail in the long term. He's saying it's unlikely once consumers switch from cars to SUVs to first time, that they'll switch from SUV to another SUV. SUVs tend to last longer than cars, and people need cars for different uses. Sometimes an SUV is unnecessary.
 

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Demise of the unprofitable Focus is not a hard hit to Ford's plan.
I don't think this would have been the affordable entry some people assumed it would be.
This would have been priced similar to the Subaru CrossTrek, but would have lacked clearance and more importantly AWD.
Profitable??? maybe slightly, but not enough margin to cover good lease deals or incentives.
I doubt they will have trouble selling all regular Focus hatchbacks and sedans the plant can produce, and do so in closer markets.
As for the current sedan owners swearing they will switch brands, I say we will see when the time comes. Many who say that now will make the switch to CUVs, and Ford will have many owners switching from other brands to buy the Ranger, Bronco, Maverick, and the electric CUV.
Many cellphone companies did not want to give up on flip-phones. The ones that did are still around.
 

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Focus Active was never intended as a Crosstrek competitor, it 's just a Focus HB
with slightly higher ride height and plastic wheel arches.


Ecosport and ICE Fusion are the two products Ford will use to fill the gap.
Those are the two easiest product levers to pull.
 

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Bloggin,
do you think that if Ford reversed it's course of eliminating low to zero margin products, and instead continued forward investing millions to upgrade and attempt to gain some margin......that they would be better off? I am not talking sales volumes, that is easy, and they have been doing that for some time. But rather, increasing margins/profits.

I can't see a bright future in that direction. Not with all the headwinds coming in every direction.
That's the distortion....it's ONLY Ford that is talking about sedans, hatchbacks, 5-doors that are 'unprofitable' or zero margin as you mentioned. ONLY Ford. But it is that way for Ford because they did not plan long term for sedan/hatch success in the US, like they do for F-150(high volume, high fleet/commercial sales, economies of scale, higher margin on higher trim levels). Ford needs a long term sedan/hatch/car plan that they did not have, which is why 'cars' crashed and burned for ONLY Ford from a volume/profit/margin perspective. And no....sales volume is not easy when you did not invest early on in production capacity. Again...long term planning.

At this point, I think Ford's best option is to go all in on EV sedans/5-door models. This is the new future of the 'car' especially for commuters, and since Ford is out of the ICE car business in NA. While at the same time Lincoln needs a flagship EV sedan that all other sedans from Lincoln to Ford will trickle down tech from. This gets Ford in a higher volume EV segment on the luxury and consumer side. It's about investing in the future and getting volume up to become profitable, and not sitting back and waiting for the competition to build the EV segment and play catch up.

But clearly the charge more per unit to increase margins at low volume is not a good plan long term. The reality is that there are over 500,000 'car' sales that Ford will be giving up to the competition offering what the consumer is asking for, while Ford is trying to offer an 'image upgrade' at a premium price.
 

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Most of those 500K sales will be made up with much more profit vehicles.
And again, volume means squat, if you have to throw cash on the hood or lease for cheap with tiny margins.
That's not going to work out based on this fact...

"Many Ford owners surveyed said they'll likely buy their next vehicle from one of Ford's rivals. Among Ford sedan owners, half said they would switch to a new or used car from another automaker for their next vehicle. Only 10 percent said they would get a new crossover or SUV from Ford; 5 percent said they'll get a Ford Mustang and 3 percent said they will drive a new Ford pickup."

I know, it's funny how we like surveys that tell us what we want to hear, but want to discount the survey outcome that tell us the opposite. But with half the sedan owners going to the competition for another sedan and just 10% thinking of spending more on an SUV/Crossover...Hackett's plan is falling apart before it even starts.

And again, it is ONLY ONLY ONLY FORD that seems to struggle with profitability with 'cars', and that's an issue Ford needs to fix, instead of sending their car customers to their competition.

GM actually points this out directly..

"As other people are making noise about leaving the car business or thrifting back their portfolio, there's still business to be had there. It's just going about the business in a smart fashion."

Essentially GM is calling Ford management stupid. Ford just need to get smart, and not just quit. Don't drop out of Calculus because your old study plan is not working and your grade is low and you got half a semester left. Get help, learn to think differently, work smarter and pass the class.
 

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That's not going to work out based on this fact...

"Many Ford owners surveyed said they'll likely buy their next vehicle from one of Ford's rivals. Among Ford sedan owners, half said they would switch to a new or used car from another automaker for their next vehicle. Only 10 percent said they would get a new crossover or SUV from Ford; 5 percent said they'll get a Ford Mustang and 3 percent said they will drive a new Ford pickup."

I know, it's funny how we like surveys that tell us what we want to hear, but want to discount the survey outcome that tell us the opposite. But with half the sedan owners going to the competition for another sedan and just 10% thinking of spending more on an SUV/Crossover...Hackett's plan is falling apart before it even starts.

And again, it is ONLY ONLY ONLY FORD that seems to struggle with profitability with 'cars', and that's an issue Ford needs to fix, instead of sending their car customers to their competition.

GM actually points this out directly..

"As other people are making noise about leaving the car business or thrifting back their portfolio, there's still business to be had there. It's just going about the business in a smart fashion."

Essentially GM is calling Ford management stupid. Ford just need to get smart, and not just quit. Don't drop out of Calculus because your old study plan is not working and your grade is low and you got half a semester left. Get help, learn to think differently, work smarter and pass the class.

This is the problem with surveys........define "many owners surveyed"

100?
1000?
10,000?


See my point?!!


And GM will surely benefit from their competitors missing low profit products. Ford is counting on it.
 

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@Bloggin is saying if you fail to plan long term, You will fail in the long term. He's saying it's unlikely once consumers switch from cars to SUVs to first time, that they'll switch from SUV to another SUV. SUVs tend to last longer than cars, and people need cars for different uses. Sometimes an SUV is unnecessary.
I don't think anyone is saying Ford is failing to plan long term. If anything, they are planning too far out.

And I don't think an SUV or CUV lasts any longer than a sedan. If you price a $35K CUV and compare it to a $35K sedan, I just don't see where longevity is a factor.
 

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Regardless of what business you're in, you need to have a variety of products to satisfy as many customers as you can. If you sell only extra large t-shirts, you probably won't be in business very long. The customer will go to the supplier that offers more choices and at price points they like.

Losing any customer to the competition is bad. If they go somewhere else to buy what they couldn't get from Ford, and have a good experience, they won't return. If they decide they don't want cars anymore, they will most likely buy their next vehicle from the same company. Sometimes you need a lost leader to keep customers coming in the door knowing that when they do decide to upgrade to a CUV, SUV, etc, they will most likely stick with you.

Having worked for Ford for 20 years I have shaken my head many times on some of the decisions they have made, but in the end I supported them because I trusted that they knew more than I regarding the business and were making the best decisions for the company. What I don't understand is how only Ford seems to be plagued by the tariffs while the competition seems to be unfazed.
 

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Essentially GM is calling Ford management stupid. Ford just need to get smart, and not just quit. Don't drop out of Calculus because your old study plan is not working and your grade is low and you got half a semester left. Get help, learn to think differently, work smarter and pass the class.
You mean the same GM that just sold an entire brand and removed themselves from entire markets because they couldn鈥檛 figure out a way to make those operations profitable?
 

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Malibu and Cruze both debuted in 2015 or 2016, while Focus and Fusion debuted in 2011 and 2012. Of course, GM will hold onto them longer. I bet Malibu and Cruze will both be discontinued around 2022 or 2023.
 

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GM may be calling Ford management "stupid" but they have not proved themselves to be much smarter. Yes, Opel became a lost cause due to poor management. Perhaps Ford-of-Europe gained some attention for having the same name as the parent company. This matters to Ford (family) shareholders. Opel had been with GM since before WWII (its assets having been expropriated by the Reich, temporarily thanks to Allied forces) so shame on them for letting their European franchise crumble.

GM may be right about the sedan decision but they're having their own trouble getting their goose out of the pot. That doesn't exonerate Ford for bad decisions made in Dearborn. Perhaps the negativity heard form Ford rank & file comes from the fact that they are consumers. The people making decisions at headquarters are not consumers.

In any OTC business, the consumer is always right.
 

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Outside of F Series, very few vehicles at Ford make profit beyond covering
manufacturing and development costs. This becomes apparent when we look
at every other division outside North America. When vehicles form those
ROW locations do not include a lot of high series trims, profit evaporates.
 

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Malibu and Cruze both debuted in 2015 or 2016, while Focus and Fusion debuted in 2011 and 2012. Of course, GM will hold onto them longer. I bet Malibu and Cruze will both be discontinued around 2022 or 2023.
And maybe that's part of the problem, Ford lets the models hang around too many years before renewing them, and when they do, the designs are based on input from other markets like Europe and China.....and not NA. Both GM models should be EVs or be replaced by EVs by 2022-2023. Ford will be on their next CEO trying to get themselves back into the car business by then as well.
 

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Discussion Starter #37
And maybe that's part of the problem, Ford lets the models hang around too many years before renewing them, and when they do, the designs are based on input from other markets like Europe and China.....and not NA. Both GM models should be EVs or be replaced by EVs by 2022-2023. Ford will be on their next CEO trying to get themselves back into the car business by then as well.
Ford is already ahead of GM then, the Mach1 will be here end of 2020.
 

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"The move will actually make little difference on Ford's profits because the company was expecting to sell fewer than 50,000 of the vehicles in the U.S, anyway"

But looking at the sales expectations, Ford only expected to sell about 5k monthly of the premium priced Focus.
 
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