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Mercury C557
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Discussion Starter #1
a couple related articles - probably more coming...


Quality, technology help Ford boost vehicle sales prices
- DetNews

Bryce G. Hoffman / The Detroit News
Friday, October 9, 2009

Dearborn --Two months ago, Ford marketing executives watched as a panel of California consumers checked out one of their new, European-designed small cars.

Surveyors asked the group how much they thought the car would cost. Most shouted out a price well above what the company plans to sell it for in the United States. Then they ripped the masking tape off the badge on the hood and revealed Ford's Blue Oval. For the first time anyone could remember, the price actually went up.

"We didn't hug each other, but we came close," confessed Jim Farley, Ford's global marketing czar.

For decades, Ford has had to sell its cars for less than similar models offered by Japanese competitors because of its inferior quality and lackluster designs. Now, with Ford's quality rivaling the best in the world and a new generation of edgy cars and trucks hitting its showrooms, that is beginning to change. In the first six months of the year, Ford's net pricing increased by $1.9 billion. Most of those gains came in the U.S.

As the other Detroit automakers watched their market share erode and heaped big incentives on their products to stanch the hemorrhaging, Ford increased its share of the market -- and did it with lower incentives and higher sticker prices.

"That's huge," said analyst Eric Selle, who follows Ford for JPMorgan. "It's very encouraging for the future, when they are going to have to start making money on smaller cars."

In fact, Farley says the success of Ford's new product strategy, which aims at replacing its decades-long dependence on big trucks and sport utility vehicles with a more balanced product portfolio, is predicated on these pricing gains.

Making money off small cars has been an elusive goal for American automakers, but he said Ford's pricing gains -- coupled with cost savings from union concessions and a new global product development system -- will change the game.

Farley credits Ford's pricing gains to a number of factors: new models and improved quality, cutting-edge technology like Ford's voice-activated Sync system, and a host of tweaks to pricing and production that were the products of sophisticated mathematical modeling. Ford also has benefitted from positive consumer sentiment stemming from its decision to forgo a federal bailout.

Neither General Motors Co. nor Chrysler Group LLC would provide net pricing data. Analysts say the average price of their vehicles fell during the first six months of this year, in part due to their bankruptcies. Both are now trying to reverse that trend.

"Our main goal is to enhance our brands," said Chrysler spokeswoman Kathy Graham. "Part of that is being competitive in the marketplace on a transaction price basis."

GM spokesman John McDonald said the Detroit automaker's average transaction price increased from August to September, though largely because of increased demand for trucks.

Farley said Ford still has not achieved pricing parity with brands like Toyota and Honda, but he said the gap is closing.

"We still have a lot of work to do," he said. "But I'm confident we can continue to do this."


 

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Mercury C557
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Discussion Starter #2
Ford taps new 'Whiz Kids' to help navigate road to success - DetNews
Bryce G. Hoffman / The Detroit News
Friday, October 9, 2009

Dearborn --Ford Motor Co. has a secret weapon: a group of latter-day whiz kids who are using mathematical models to boost the amount of money it can command for its vehicles.

Led by Rose Peng, this team of 19 Ph.D.s from the fields of mathematics, physics, statistics, economics and engineering is helping the company set pricing, plan production and strike the right mix of options and features in its new cars and trucks. Other automakers haven't committed similarly qualified employees in the way Ford has.

The Ford team is credited with helping the automaker post a $1.9 billion net pricing gain in the first half of one of the worst years in automotive history. "Rose and her team have been key to that," said Ford sales and marketing chief Jim Farley. "They are unbelievable. It's very scientific. I've never seen anything like it in our industry."

But it is not the first time Ford has looked to mathematics for salvation. Six decades ago, a group of young Army Air Forces officers led by statistician Charles "Tex" Thornton famously paved the way for the Dearborn automaker's postwar resurgence and created modern corporate management while they were at it. Dubbed the "Whiz Kids," they were the first to apply mathematical models to corporate decision-making.

Now, Peng and her team are taking that science to a whole new level. "We forecast the future," she said...

...By 2005, they had figured out that the resale value of Ford's cars and trucks was being eroded by sales of poorly contented vehicles to rental agencies -- a critical problem for a company taking back a million leased vehicle each year. Their models showed that if Ford cut back on these low-margin sales, the value of its vehicles would go up dramatically.

And it did...

more...
 

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Mercury C557
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Discussion Starter #4
just saw Jim Cramer give a resounding plug to Ford on CNBC
- mentioned double digit increase in Europe LINK
- outstanding performance in the U.S.
- Mr. Mulally as wonder-worker (my words, his meaning)

to the point of being a "WTF, go buy some"



guess I'd better crossreference this old Poll
- was thinking of doing that about a week ago when "F" briefly dipped below $6.80... ...now that We;) are almost a buck higher ( +$.50 today as I type),
not sure if I'd wait to see what oil/ga$ does :confused:
or
get a bit closer to the autoshow season ;)
 

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I like Ford's idea of making cars more profitable.

The old way seemed to be making more cars, in an attempt to turn a profit.

Looks like reports I read today say that GM is going to over-produce so much next year, that they will be stuck with high incentives. What happened to the "new" GM.
 

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The Spaminator
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just saw Jim Cramer give a resounding plug to Ford on CNBC
- mentioned double digit increase in Europe
- outstanding performance in the U.S.
- Mr. Mulally as wonder-worker (my words, his meaning)

to the point of being a "WTF, go buy some"



guess I'd better crossreference this old Poll
- was thinking of doing that about a week ago when "F" briefly dipped below $6.80... ...now that We;) are almost a buck higher ( +$.50 today as I type),
not sure if I'd wait to see what oil/ga$ does :confused:
or
get a bit closer to the autoshow season ;)
Ill go on a imb here and say Ford will go $2 higher by the end of the month. Why? UAW contract will be passed lowering costs and Q3 results.



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