By on August 3, 2006

8-FordEdge222.jpgAlthough GM’s woes are increasingly well known, the House of Ford is also in dire straits. The Blue Oval’s credit has been downgraded almost as often and deeply as The General’s. FoMoCo’s products– a truck-heavy mix in a time of fuel conscious fervor– languish on dealers’ lots with equal abandon[ment]. Both companies have too many lackluster products, confused brands and mainline dealers. In fact, other than the size of their relative problems, the chief difference between GM and Ford has been the Blue Oval’s bluster, bold moves and all.

In the first half of ‘06, Ford's US market share slumped another four percentage points. In the first financial quarter, the company suffered a $457m loss. In the second, they took a $254m hit. No surprise there. Even the F150, America’s best selling pickup truck and Ford’s perennial cash cow, seems welded to dealer lots (down 46% in June). To move the metal, Ford has increased incentives and lowered prices on models both old and new. And even the ones that've moved out are coming back; the company has just recalled 1.2 million trucks, sport utility vehicles and vans for potential engine fires. Ford needs something to pull itself out of its corporate tailspin. As Taylor Hicks might say, what are the possibilities?

Nothing much. Even with accelerated product development, it will be two to three years before Ford can readjust its product line to match the new sales environment. Most of Ford’s ‘07 to ‘10 models will be SUVs and pickups. At the same time, Ford is pulling the plug on its big rear wheel-drive sedans and ill-fated minivans: the Mercury Monterey (down 40%) dies next month and the Freestar (down 20%) goes away in April. FoMoCo’s move to deep-six (rather than re-engineer) their big sedans and people carriers when the American market is flooding with SUV refugees reflects a lack of resources, imagination, will or all three.

Ford has also failed to refresh their fuel-sipping, dynamically superlative Focus– before it fades away like the once-great Taurus. And they've decided to shelve their well-publicized goal to build 250k hybrids by 2010, despite a huge jump in Escape Hybrid sales. Playing the flexible fuel card instead may earn Ford the environmental brownie points it seeks, but hyping vehicles that run on a fuel that’s not commonly available that gets worse mileage than “normal” gas will do nothing to cater to America’s changing vehicular tastes.

Fortunately, there are a few reasons to be cheerful.  In the short term, the Hecho en Mexico Fusion/Zephyr/Milan continues to depart dealer lots at around 19K units per month. Equally heartening, the Fusion and its badge engineered siblings are mining a rare vein of consumer loyalty; 93% of Fusion owners say they’d recommend the model to a friend. Yes but– the model isn’t generating enough sales activity for Ford to clamber back from the lowest market share since the Ford Pinto galloped onto the US sales chart.

To that end, Billy’s Boys have green-lighted three new 40mpg-plus B-segment vehicles based on the Mazda3 platform, two of which could arrive for the ’09 model year. There’s also a new small minivan slated for ’10 and the Fairlane box car.  In the medium term, Ford’s immediate future may well rest on the Edge/Lincoln MKX Crossover. The American automaker has set a sales target of 120k unit per year for the 265hp, all wheel-drive whip. If dealers fall short, Ford’s only bold move may be towards Chapter 11.

No wonder the Blue Oval is thinking the unthinkable. After spending some $10b trying to make Jaguar their upmarket brand (forgetting Lincoln), the British marque is now, finally, reportedly, up for sale. Industry wags also suggest that Volvo and Land Rover may be on the auction block. There’s also talk of Ford taking up GM’s offer to join the Nissan – Renault alliance– or marrying its fortunes VW, BMW, Honda, Toyota or Hyundai. And just in case you thought these options are the result of ill-informed conjecture, Bill Ford Jr. just hired former Goldman Sachs and Bank of America investment banker Kenneth Leet as his big picture guru.

Provided Ford has enough cash to see it through these dark days, Moray Callum is the more important man in this drama. Ford’s new Director of North American car design– the man credited for the RX8, Mazda3, Mazda6, Cx-7 and CX-8– has received carte blanche to create vehicles that inspire the American public to return to the Ford fold. The company has access to sixty-five thousand automotive R&D workers in Michigan alone and a $7.5b R&D budget. Like everyone else in the Ford Empire, Callum knows that his employer has to create at least one major hit, and soon. As always, a carmaker’s future ultimately depends on its ability to make the right cars at the right time.

Get the latest TTAC e-Newsletter!

84 Comments on “Ford Death Watch 1: Desperate Times...”


  • avatar
    Sajeev Mehta

    Well said. Hopefully those great cars will come in the next few years.  After seeing all the once-proud mainstream models (Focus, Taurus, Sable, Continental, Cougar, Crown Vic, etc) allowed to stagnate and/or die, Ford's current situation isn't a shocker. They shot themselves in the foot at every opportunity.

    Jag's gotta go.  If it sweetens the pot, sell PAG off with it.  

  • avatar
    mike1939

    Totally agree with all that is said in this article.  With great products car companies can still go belly up but with out inspiring cars that meet a need then they will never succeed and Ford does not have too many of those right now.

    Jag was a basket case when Ford bought it but has any marques product planning been so awful?  Probably but I can't think of any right now. All that heritage which is obviously important in that exec segment blown. A wasted opportunity along with boat loads of money. Perhaps it would be a good thing to let someone else have a go at the job.  Ford will have to do a lot better than they have in the past to be a viable player in the medium to long term in my view.

  • avatar
    3000GTdriver

    Having read Lee Iococca's biography I found that he engineered a deal with Honda to supply engines and transmissions to be placed in a sub compact car built by Ford.  Lee wanted to develop a car sort of like a Honda civic.  With the energy crunch of 73 it would have been a good seller in the mid 70s but more importantly it would have created a Honda/Ford relationship.

    Henry Ford II killed the deal becasue he was a biggot that did not want a single "Jap" part on his cars.  I'm surprised Ford did as well as it did in the 1980s.  The only exciting cars they had were the T-birds (SC coupes) and the SHO Taurus.  The trucks for personal use were nothing like they have been since the 1990s.

    Anyway, this was a major wrong turn for Ford over 30 years ago and now it will haunt them.  I highly doubt they will be able to sell the 120K units of the new SUV.  Having driven a 99 Ranger for 3 years as a company car I would not say it was a bad vehicle.  The problem just has to do with how tilted their income from SUVs and trucks is.

  • avatar
    3000GTdriver

    Lee Iacocca wanted to partnership with Honda when he was in charge of FoMoCo in the 70s.  Henry Ford II killed the deal purely becasue he was a biggot that hated the Japanese; among others.

    A wrong turn taken in the 70s has come to haunt Ford.

  • avatar
    qfrog

  • avatar
    qfrog

    Sounds to me like its time to for ford to fold their cards and give up the
    ghost. Can't say that I'll miss their mediocrity mobiles on the
    roads. The only bold move for ford will be to carve itself up and
    auction off the pieces. Now thats a bold move, like you've gotta
    respect a guy that cuts himself up, cooks some and eats it. Okay I guess letting the focus go unchanged for so long is kinda bold too its akin to just letting it ride with changing the baby. While it might smell a lil raunchy truth be told there is nothing seeping out around the leg holes or waist, just how bad can it actually be?

  • avatar

    Thanks for my evening fix.

    You write:
    At the same time, Ford has failed to refresh their fuel-sipping, dynamically superlative Focus– before it fades away like the once-great Taurus.

    And boy does the Focus need to be refreshed. At a time when most cars are pathetically ugly, the Focus, with its fish face, is one of the ugliest. (The Focus is "F" in the ugly car alphabet that I use to help my girlfriend get to sleep.) Aesthetics doesn't get much consideration when I buy a car, but I don't think I could put a Focus in my driveway. 

  • avatar
    phattie

    One of the problems with the Jaguar line is that they all look like Fords. Esp. the last generation Taurus with its ovoid headlamps and intake.
    It good that the Fusion is doing well. What they need to do now is completely redesign it every 4-5 years like the Camry and Accord. 
    Volvo and Rover make sense and money, so reason to axe them with all the work put into them. But, cut loose the cat.

  • avatar
    rohman

    My wife is driving a Mercury Vilager (Nissan Quest) that I bought new in 1995.  It has 212500 miles on it and other than normal maintenance, the repair bills, the largest of which was replacing a rear seal on the motor, have total a little less than $1500.00.  It is still running strong and she trusts it and doesn't want a new van.  But I can see a few small rust spots and common sense tells me that mechanically something major has to give soon.  With domestic auto makers in such dire staights and offering attractive discounts, I feel we should consider their offerings.  We have looked at Ford's line-up and there is simply nothing there that my wife considers good enough to replace her 1995 VAN WITH OVER 200000 MILES ON THE CLOCK!  The only domestic replacement that she has looked at twice is a new Dodge Caravan and I'm not sure I trust its reliability.  Bottom line is that she is likely going to end up with a new, or possibly used, Honda Odyssey.   

  • avatar
    Infamous Dr. X

    While I obviously want Ford (and GM, for that matter) to find some way to turn themselves around and claw their way back to adequacy (greatness may be too much to ask for) I'll admit that, perhaps selfishly, I care more that the Cat lands on its feet.
    Does anyone know who the likely takers – if there are any – would be, and what it would mean for the brand? 

  • avatar
    Infamous Dr. X

    Hmm. Disappearing comment, again. Oh well.

  • avatar
    Infamous Dr. X

    I'll try again, quickly.

    As far as cutting Jaguar loose, does anyone have any idea who the likely takers would be (if there are any) and what that would mean for the brand? 

  • avatar
    starlightmica

    I read that Jaguar's cash drain was even bigger than $5b, closer to $10b.  They should have dumped the cat long ago, but hindsight is 20/20.  Perhaps the Brit trio will be sold off together: Jag/A-M/L-R.  Can Mazda or Volvo even be spun off?  they're the older acquisitions, responsible for the platforms of upcoming cars.  It's a race against time, depleting cash on hand vs. right-sizing the corporation, although the Ford family is a variable that makes this Deathwatch different from GM's.

    Ford's corporate fuel economy is the worst of the big six, and its dependency on trucks and SUV's for profits will be hard to break.  Will selling lots of Mexican built B-class vehicles and Fusions make up for those?  And with the Euro going up, a crash program to bring EU market Fords over would probably not make sense in the short run.

    Are Ford's hybrid efforts for naught?  The Mariner Hybrid just got a harsh writeup here and that's the powertrain that's roughty comparably sized to Toyota's 2.4L HSD powertrain that gets better power and fuel economy.  Hope they get it right before it goes into the Fusion, etc.

  • avatar
    stanshih

    Mr. F and Mr. Neundorf,

    I have to thank you while I can for this new series because I'm afraid this Ford Deathwatch won't last nearly as long as the vaunted GM Deathwatch series.

  • avatar
    qfrog

    Dr. X
    I've taken to posting a few words or letters…. then editing it
    once I see something post. I've not had any issues with the edit
    function just yet, where as the post function doesnt seem to work when
    I write a whole lot. Another safety precaution is to Ctrl + A the
    window then Ctrl + C the highlighted text for later Ctrl + V rapid fire
    action. 

  • avatar
    FunkyD

    It should be a crime for what Ford has done with the Focus.  They took a car that was capable (with a little attention to detail) of directly challenging the Honda Civic and let it wither on the vine.
    Couple that with their completely underwhelming car line (except for the Mustang and perhaps the Fusion), which is even less inspiring than GM's, IMO.  Add the fact that Ford completely lags behind GM in the hi-performance department (a result of sticking with the 4.6L for far too long.  Throw in some much-publicized safety recalls from the Firestone debacle to the fire-in-the-hole cruise controllers.  And the icing on the cake is that even in the bread-and-butter truck market, other than the vaunted F-150, Ford lags behind GM in product development.
    I think Ford is actually in more danger than GM going into the future.

  • avatar
    tms1999

    Alarming to me is the disconnect between immediate needs: not dying now because sales are down, and the solution: new products with a time to market close to 4 years (new models based on the C1 platform coming to a dealer near you in '09)
    You could not predict that 4 years ago?
    How do the competitors do? They fill all the segments, all the niches and they produce as much as they can sell (admitedly for the competitors, they are both smaller and less hindered by union workforce and existing contracts) 

  • avatar
    Joe C.

    One interesting thing I’m seeing around here (Northern CA) are car-carrier loads of Chevy Aveos heading for dealers, and many more of them freshly hitting the road. Dealers are showing “Chevy Aveo – 34 MPG HWY” on their flashing freeway signs.

    Why isn’t Ford running extra shifts to produce European Focuses, ship them here and sell them? Is there NO way to get some of them approved or modified for sale in the US? It’s an established model, so it would seem to be an easy marketing move to promote the update.

    I dunno – seems like a way to get somebody to Ford lots.

  • avatar
    levi

    In the early first of half of the 20th century, there was a great winnowing of American automobile manufacturers.

    In the first half of the 21st century, there will be another great winnowing. Only this time it will be worldwide, and the American survivors from the former will be among the casualties.

    The face of the automobile industry in this country is about to change dramatically, and Mr Farago’s site here is one of the first to chronicle this sweeping change.

  • avatar

    “I read that Jaguar’s cash drain was even bigger than $5b, closer to $10b. ”

    The Detroit Free Press pegs the figure at over $10B as well.

    http://freep.com/apps/pbcs.dll/article?AID=/20060702/BUSINESS01/607020588/1014

  • avatar
    3000GTdriver

    Toyota should buy Jaguar and fire all of the management of the division because they have dismanaged it for a long time. Since Toyota is nothing but growth they will be able to hold on to Jaguar for as long as they wish. With a lot of Lexus put in under the skin, the next gen of Jags can be great cars. Small stuff like how switches work, displays look, etc….Lexus does very well.

    The classic XJ should stay the same looking car by all means.

    The old Ford taurus front bumper on the new Jag XK line is a disgrace.

  • avatar
    CellMan

    I’m really pissed at what Ford let happen to the Focus. It was a great small car when it came out. Why o why couldn’t they have kept it fresh, given us the new version that’s currently available in Europe?? They could have had a long term winner.

    I’m curious about Jaguar. Lots of you have said that they mismanaged Jaguar, forgot it’s heritage and history, etc. Exactly what should Ford have done with Jaguar to make it a stronger brand, profitable, desirable, successful, etc? What kind of models did Jaguar need?

  • avatar
    skor

    Ford admits that it won’t have the product it needs in North America for at least three years. Without a miracle — gas dropping to 99 cents a gallon — I don’t see how they can make it.

    What I don’t understand is how they could have fumbled so badly. Why didn’t they bring the European Focus to American? Why didn’t they co–develop new models based on the Mazda 3 and 6 platforms? Why didn’t they bring in some of their Australian Falcon variants?

    It’s as though Ford stood in front of the mirror one morning to shave and decided to cut it’s own throat instead. Very strange.

    The only thing to do now is to take bets on who goes tits up first, Ford or GM.

    Bye, bye American car industry.

  • avatar
    taxman100

    Ford has not developed new cars because they no longer have the ability to design them in North America – Nassar and Billy Boy has wrecked the company in a quest for short term profits by rebadging lame-ass product from Europe and Japan.

    Even the Mustang is loosely based upon the same platform as the Jaguar. The only North American automobile is the Crown Vic, and that one has been put on ice for about the last 15 years – the last product designed when Ford had pride in their automobiles.

  • avatar
    qfrog

    LOL… skor I like how you put things
    “It’s as though Ford stood in front of the mirror one morning to shave and decided to cut it’s own throat instead. Very strange.”
    I conclude that ford’s HMO plans don’t cover anti-depressants.
    It’s not like the big 2.5 make a whole lot thats worth buying imo… I see no major loss in terms of product selection save for trucks.

  • avatar
    qualityg

    Quality Leadership ? CHEAP SHOT PLAYED BY FORD MOTOR COMPANY

    http://qualityg.blogspot.com/2006/08/quality-leadership-cheap-shot-played.html

  • avatar
    nino

    I’m of the opinion that Ford’s product line isn’t as bad as has been made out to be.

    I agree that Ford should bring over the New Focus that is sold in Europe, including the hardtop convertible and the minivan versions. I’m with those that have decried what Ford has let happen to the Focus. Ford should also bring over the Ka as their “B” segment leader.

    I’m a fan of the Ford 500 and especially the Freestyle. These are roomy cars (for all you big guys that need a big car for comfort), have 4 wheel drive available, and if fitted with the upcoming 3.5 liter, 250 HP V6, have good power. I agree they need better styling, but now with a new designer on board, it could happen.

    The Fusion should expand to include at least a wagon version. That should be pretty easy since it’s built off the Mazda6 platform. They should look into a Fusion coupe as well, possibly with the 3.5 V6 engine in it.

  • avatar
    mculbert

    Rohman,

    Your Villager is about 95% Nissan. Engine, transmission and body from Nissan’s Tenessee factories. Ford contributed final assembly in Ohio.

    Built before Nissan started cutting too much $$ out.

  • avatar
    Maaxm

    What is bothering me the most is the timeline for the next models (3 to 4 years). I just can’t believe they can not bring european/australian cars in 1 to 2 years, just to compete. Like for exemple, just to name one, the Fiesta is a much better car than de Chevy (Daewoo) Aveo, not to say that it’s already in Mexico and South America. Ford as some really good car all over the world, but i don’t known why they don’t bring any here.

    Sorry for my bad english, it’s not my first language.

  • avatar
    sitting@home

    Aren’t Jaguar, RangeRover & AstonMartin all attached at the hip with powertrains and manufacturing sites ? I remember there were ‘words in the Commons’ when the Tory government waived their golden share to allow Ford to assimilate Jaguar, which was profitable at the time. 10 year product cycles and cars which are obsolete at launch put an end to that.

  • avatar

    Two words of advice, Moray Callum.

    Forty-Nine

    (http://tinyurl.com/kv49t)

  • avatar
    FunkyD

    Product timeline is critical. According to MSNBC, trucks & SUVs accounts for over 2/3 of Ford sales in the US! And a lot of it’s current development effort is in crossovers, and they’ve already given their competition at least 3 years’ head start in that category.

    Ford of Europe has been doing pretty well. As Maaxm, and others have pointed out, they need to do a Lutz and Americanize decent cars made elsewhere. At least it will buy them some time.

  • avatar

    I could easliy see the Volkswagen group snatching up Jaguar. VW did badly with the Phaeton because, honestly, who wants an $80,000 Volkswagen? But slap a chrome cat on the hood and I bet the takers would double.

    Range Rover is finally seeing some improvement after loads of Ford cash were sunk into it, but who wants to buy an SUV-only company in times like this?

    Maybe Porsche would be interested in buying Volvo, giving it the broadened customer base it’s been seeking lately. It could ditch its Panamera project and instead modify the V70 with sleeker lines and a mega-HP power plant.

    Ford should continue to build the popular (and more importantly profitable) F-150, the Econoline, the Mustang, a much freshened high-mileage Focus and one very well-engineered entry-level luxury sedan. When sales improve and the coffers refill, then they can chase other segments including hybrids.

    Give Lincoln the Navigator and a luxury sedan to compete with (no, not BMW. get real) Cadillac and hire somebody, ANYBODY, who can design an interior with no fake woodgrain.

    Mercury could have closed its doors yesterday and nobody would have noticed.

  • avatar
    starlightmica

    Here’s the FoMoCo future pipline, read it & weep:
    http://www.autoweek.com/apps/pbcs.dll/article?AID=/20060802/FREE/60731029/1041/TOC01ARCHIVE
    No new Focus until 2010, B-segment cars are 3 years off, 2nd gen Ford hybrid isn’t due for 2 more years, uncertain plans for the Ford Ranger, no Lincoln based on the Continental show car concept from a few years ago, etc.

  • avatar
    ghughes

    I have always thought that fomoco is worse off than the general. Compare Lincoln, whose new product is derived from a smallish mazda and they are killing the town car!!!!!!! (Ive owned 5 of those), to cadillac. It is that simple.

  • avatar
    sigsucker

    Rohman,
    Go with the Caravan, I’ve had mine since ’96, and have had no trouble with it in 165,000 miles. Except for the usual wear and tear stuff, just don’t get the 4-banger, The van is too heavy for it, my sister had a four-banger, and nothin but trouble. My mother and father also had caravans, they upgraded to the Chrysler Town and Country for the comfort. it’s been bery bery good to dem.  The 3.3 6cyl. is the best. Plenty of power, and plenty of torque. I recommend it to anyone over Ford, Chevy, Nissan, and Honda vans, of which i have driven the Ford and Chevy at work, and test drove the others. Even my wife likes the ride. And when MAMA’s Happy,… Everybody’s happy!
    Maybe I should change my logon to Mopar Man, I don’t know, maybe you just go with what you were taught.
    I’ve had Dodge’s all my adult life, I still have my ’89 Shadow, gutless wonder that it is, but get rid of it? It aint dead yet. (If it aint broke don’t fix-it)  (Back to the old beater article) I think that’s part of the problem with Ford and GM, Bring back what works, and don’t  "fix it till it’s broke" .

  • avatar
    niky


    That FoMoCo timeline is weird, especially since the Euro-Focus
    already meets 99% of the criteria it needs to meet to make it in
    America, and is already available in LHD.

     And goodbye
    Jaguar?  Good riddance.  Although I think the current XJ is
    still a sensationally sensuous vehicle, Ford still hasn't been able to
    make them a good alternative to the Germans.  Jaguar, go. 
    Land Rover, go.  Aston?  Maybe.  Volvo?  Keep
    it.  You'll need something to base the next generation of boring Fords off of.

  • avatar
    Humourless

    I can't figure out who would take Jaguar off Ford's hands?

    GM?  Nope.  Where's the cash?
    Toyota?  Not when they have Lexus already.
    VAG?  They already have luxury bases covered with Audi and Bentley.
    BMW?  Ditto.  Plus they already did the "English Patient" routine with Rover.
    D-C?  "Don't mention the war…."
    Fiat?  Why and how?

    The only viable options are PSA, Renault/Nissan, or Honda.

    PSA doesn't seem to want to play outside of their own backyard (though a case can certainly be made for buying into a company that doesn't tread on any of their current product line). 

    R/N just doesn't seem like a logical fit; if Ghosn's sole MO is cost-cutting, where are the synergies to be found in Jaguar?

    In a weirdly perverse way Honda makes the most sense to me in that they've little overlap (Acura is North American only and never has had the product mix to go toe-to-toe with real luxury brands), have a strong engineering tradition, and would probably give Jaguar enough breathing room to do their own thing.

    Of course, there's always the option of Rich Uncle Wang swooping in from China….

  • avatar
    Schmu

    I have to say, I am a big fan of short redesign cycles. But with the
    Focus, Ford now actually has all the bugs worked out. It took three
    years of continuous recalls to do it, but now its a reliable vehicle. I
    like the new "fish face" on it. Of course I will still bemoan how its
    gets so much worse gas mileage than a Civic or Corolla, but it is on
    par with all the other brands' competitors. I would just hope that when
    a new model comes out, they don't need 2-3 years of recalls to work out
    the bugs. That is supposed to be done before the model is released.
    Toyota's recent recalls ought to remind everyone that reliability can
    be fleeting once it loses the priority. On a second note: As I ahve
    said on this site before, I am not buying a Mexican vehicle. Maybe that
    makes me a bad car guy, but there are plenty of choices for me for
    vehicles manufactured here to choose to send my money elsewhere. IF the
    only way for Ford and GM to survive is to make their cars in Mexico,
    then maybe they should just move their headquarters there…then they
    would be the true imports. Untill then, I will keep my domestically
    designed and produced Honda, or Yota, or Nissan, or the few GM cars
    still made here…maybe a Dodge….i am rambling again.

  • avatar
    nutbags

    As in other industries, the MBAs and accountants that run the companies forget that the goal of the company is to sell a product at a profit.  They only concentrate on the profits (and stock price for their options) and forget about what they are selling, their product.
    When the Japanese get the product wrong (and there have been many) they investigate how and why and make improvements.  This is something the American companies fail to do, if it is not right the first time, kill it and start over.  It is a viscious cycle (and not profitable).
    As far as who could buy Jaguar – Porsche.  They have no true competitor and could use some luxury/sport sedans.
    That is all I've got for now and remember "weight is the enemy".

  • avatar
    Tiger Commanche

    Why would Ford be better off throwing more money and resources at trying to redesign their minivan?  I'm kind of surprised that you would pick on Ford for this when it seems to be a very prudent business decision.  They have clearly demonstrated that they cannot build a competitve vehicle in this segment which is seeing decreasing market share anyway.  Who says Ford or anyone else must build every type of vehicle just for the sake of having a complete product mix?  Ford realized they suck at minivans, they are never going to make an Odyssey, so they capitulated.  Would you rather they put Hot-Wheel-sized Freestars in boxes of Cocoa Puffs and have their marketing dept feed you another line of BS in a podcast?

  • avatar
    MatthewInDC


    DAMN YOU FORD for diluting the Mazda brand. As an avid Mazda fan, I am tired of seeing Mazda cars being copied as Ford models. You bring shame to the Mazda brand. I would easliy buy a CX-7, but why would anybody do that when a few months later I'll have to look at the car's ugly ass cousin Mercury and Ford model.

    Embarrising.

    Are you hearing me?

    And kill Mercury. It has absolutely no relevance to anybody below 50. 

  • avatar
    Bob Elton

    Actually, Ford is in a very different position than GM. Ford can exit the automobile business, and survive very well as a corporation. After all, they own the 6th larget bankinthe world, and one of the largest land development comapnies inthe country.

    No judge will let a company like that go into bankruptcy to avoid creditors.

    Also, bankrupt comapnies' stock usually goes to zero, or close to it. The Ford family's wealth is mostly in the stock.

    Look for Ford to transform themselves from an automaker to a bank.

    Read the details in my story in TTAC about 2 years ago.  Ford is the next Studebaker.

    Ford mey have 65,000 employees in Dearborn, but if none of them know how tomake a decent car, it won't make any difference.

    Bob Etlon

  • avatar
    Steve_S

    We have a global economy, if you don’t have the platform or product you can buy it from someone. Align with VW for small cars or use your existing relationship with Mazda. The Mazda 3 and 6 are excellent platforms to use, just Americanize them a bit and sell them. Or even better make an AWD or RWD version of a Mazda 3 in hatch, sedan and wagon trim and slap on a hybrid option. I have been looking for a new or used car for about 6 months with the following criteria: Around $30,000RWD or AWDFun to driveReasonably fastManual transmissionGood handlingCan seat 4 people easilyAttractive interior and exterior (subjective of course) I looked at every single manufacturer especially Ford and GM since you normally get the best bang for your buck from a domestic. What did I find that met that criteria domestically? Nothing. The closest thing was the Mustang but you can’t really fit 4 people and with a solid rear axles the handling isn’t the best. The Saab 9-3 was nice but slow and FWD same with Volvo. The only place I found the right mix was either Japanese or German. The German’s were too expensive new (used 3 series would have fit the bill but I’m not much on their looks) so I’m opting for Japanese. This will make the 5th Japanese car in m household and I don’t expect to come back to domestic anytime soon, holding out hope on the new Camaro but we’ll see.

  • avatar
    Steve_S

    Well so much for copy and paste from Word sheesh!

  • avatar
    chanman

    So Steve is giong to be the proud new owner of an RX-8 or Z? =D

  • avatar
    guyincognito

    One thing Ford does have going for it is lots of cash. I believe its something on the order of $24 billion, as apposed to GM’s potentially

  • avatar
    guyincognito

    Damn!!!! Lost most of what I wrote too! I’ll summarize: Festiva now, budget Mazda 3 based Focus by 08, Ranger based Bronco, diesel not hybrid across most models, improve and refresh platforms rather than hanging out to die or starting over completely after 1 cycle.

  • avatar
    AutoDiva

    This is my first time on this website, and I find it interesting how many people think the way I do.  Jaguar – gone.  Land Rover – improve their ranking as WORST QUALITY or get rid of them too.  Volvo and Mazda – keep them but don't ruin their brand image by associating them too much with Ford. 

    To MatthewInDC, I just bought a CX-7 and I love it!  Yes, the Edge and MKX will be based on this platform, but they're styling is boxy.  And don't worry, I'm sure Ford will do a good job of cutting out any of the features that make the Mazda so great, in order to save a penny or two… just like they did with the Fusion (Maxda 6).

    There was an article in the Auto Insiders on http://www.detnews.com the other day about the Focus.  In it, it does talk about a major freshening of the Ford Focus that will debut at the NAIAS in Detroit in January.  The rest of the article was confusing, because it came across as there not being a new Focus in 2010.

  • avatar
    AutoDiva

    Sorry, a few corrections….

    Major freshening of Focus for 2008 Model Year.

    not being a new Focus UNTIL 2010 (which isn't true)

    they're = their

  • avatar
    jody


    does jaguar need to exist anymore? no, it does not. nobody needs to buy it from ford. jaguar should simply disappear.

    there's no room for this brand these days. time to kill it. 

  • avatar
    Steve_S

    Chanman: Yes If I can get a hold of my crappy salesman I’m expecting to get a 2006 RX-8 Shinka in Copper Red, bright and early tomorrow morning. I’ll miss my Murano; it has been a very good vehicle to me and my family, but not too much. That 1,500 mile break in is going to be painful…..

  • avatar
    m98cox

    I don’t understand why they can’t get their act together.

    Bring the European Focus to US, so what if it cost a little too much, at least it’s new. Ford of Australia as a RWD platform. Work on updating the Town Car/Marquis/Vic on that platform.

    Bring the new Fiesta back from Australia as the ‘B’ car. They need to get back in the ‘small car’ business, but, then need not ignore the “big car” cash cow they now have.

    The small pickup market is crowded, but, it shouldn’t cost that much to update the Ranger to be competitive.

    Jag, well, I’m nowhere near buying that class of car, but, if you remember a few years ago, “up market” was all the rage. Now they are paying the price for it. I think Jag has a place, but, it could certainly share more Ford parts, which would reduce cost. For the PAG group, I would move Volvo out, leave the others and focus on quality NOT quantity, and if they sell slow, let it be. A $2k rebate on these aren’t going to convince the consumers to buy or not.

    Volvo and Mazda have contributed greatly to current cars of Ford, they can’t sell these units. But, they should continue with them and continue to share cost, etc. Look at Mazda’s sales gains. If there was a Ford equivalent of the Mazda3, you might have a winner.

    They have the R&D money, but, they already have these updated cars elsewhere. Americanize them and get them here, quick! Ford has done well with the pickups and mid-size cars, but, need a fix for others now, so, look abroad.

    Hello, Ford, you don’t need a high paid consultant to point this out….

  • avatar
    jackson_jackson

    The investment banker is “In the House”! Kenneth Leet, a former investment banker of M&A for both Goldman Sacs and Bank of America has been hired and will report directly to Bill Ford. First up for review – the Jaquar brand. Complete article is in Wednesday’s WSJ – front page.

    Jaquar – its been nice to know ya, but I wouldn’t wanna own ya

  • avatar
    Glenn

    Ford may survive, in fact I give such a scenario better odds than GM surviving. However, it would be in a far smaller form in North America.

    In fact, a strike by the UAW against Ford in 2007 would be a hidden blessing for the Ford family, who are within half a decade of losing their fortune.

    Here’s why. Ford could just say “sorry, wrong answer” and let the UAW strike forever. Ford could then simply bring in imported vehicles from its partners in China, and wholly owned subsidiaries in Europe, South America, Mexico, Canada, Japan and Australia. The company could simply point out that it is legally bound to supply Ford dealers in the United States however possible, whether Ford US factories are struck by the UAW, or not.

    The “blame” for the loss of tens of thousands of US jobs would go to the UAW, while Ford’s unprofitable operations in the US would be idled allowing Ford to instantly be down-sized worldwide, giving the operation production capacity more matched to potential sales.

    Of course, to make such a scenario work, the engineers would have to start adapting non-US Fords to US safety and emission requirements about yesterday, and on a rush basis at that.

    The upside would be that Ford would be in the forefront of offering small cars and vehicles in North America.

    Once and if the UAW capitulated, Ford could put rump plants to work, supplied from non-US factories for assembly here – that way if the UAW struck again, no harm/no foul. Just ask the Canadians, Chinese, Mexicans and Europeans to work a bit of overtime again and maybe add shifts to plants.

  • avatar
    Schmu

    what a snotstorm that would be. the morbid side of me would like to see such an action….

  • avatar
    Point Given

    It would seem to me that the suitors for the cat company would be limited.
    Who of the major auto companies would require a ailing premium luxury division? I couldn’t fathom, toyota, nissan, honda, hyundai etc etc jumping at the idea. Perhaps some of the Chinese companies looking to get a dealer network in NA would be interested. But damn, losing 10 bill’s per year I wouldn’t touch the company for anything.

    I look at the Jag’s and laugh. Looks like a Contour, looks like a Taurus, and so forth. Ford didn’t put any effort into differentiation. Just slapped on some different badges, some different trim and away they go. The laziness that they put into the Jag brand shows in the product.

    It’s worth noting, that I’m a Volvo fan and think that Volvo could succeed quite well as a distant and distinct part of Ford. I’m excited about this car from Volvo.

    http://www.rsportscars.com/eng/cars/volvo_c30.asp

  • avatar
    borderinsane

    speed42 said: “Mercury could have closed its doors yesterday and nobody would have noticed.”

    Probably, but the best part of Mercury is their spokeswoman’s Jill Wagner’s astonishingly good-looking sales pitch. (Just IMDb her name, you’ll see.)

    The fact is, Ms. Wagner’s commercials help reposition the Mercury Mariner as a brand oriented to younger women. The tactic may not have legs in the end, but it was a nifty trick to get it going.

  • avatar
    nweaver

    However, this does bring up what Ford has that GM doesn’t: Mazda.

    The European Focus: Mazda3
    The Zephyr/Fusion/Milan: Mazda6
    The Edge: CX-7
    Coming soon: CX-9

    When ford is imposed on Mazda, the results are disaster. Whenever Mazda is imposed on ford, the results make GM managers weep with jealousy.

  • avatar
    rudiger

    This is a pretty good article but one important point was missed, and that is whereas many (if not all) of GM’s problems can be traced back to one name (Roger Smith), all of Ford’s current ills can be answered with a single word:

    Nasser.

    Nasser was the one who got the company so diverted from their core automotive business that they were unable to either deal with the Explorer situation effectively, nor were they able to concentrate on maintaining market share of current models (the late Focus model upgrades is a prime example).

    All car companies have major debacles which they either recover from, or they don’t. It will be interesting to see if the Explorer roll-over fiasco, which was then compounded by skyrocketing gas prices which has squelched sales of their main profit generators (big trucks and SUVs), will be what goes down in history as doing Ford in.

  • avatar
    geozinger

    nweaver:

    GM has Daewoo. Looking outside of North America, Daewoo does a lot of GM’s heavy lifting worldwide.

    Daewoo is responsible for the Aveo and most of the Suzuki models we see in the States. They’re responsible for the European and Asian Chevy counterpart to the Equinox (I can’t think of the name), which is getting rave reviews. Many Opels are Daewoo engineered.

    I’ve said it before, the Koreans have mastered the inexpensive car game. (Which is smart, because the Chinese are coming…)

    I think that Daewoo carries so much of the load it was part of the reason why GM gave up some of it’s cooperation with other Japanese car companies, like Subaru. Why duplicate efforts?

    It’s great that Mazda can contribute so much to Fords North American lineup, don’t count out Volvo. I’ve spent some time in a 500, it’s not a bad place to be. On another note, I thought the European Focus was the Volvo V40 (or V30)?

  • avatar
    chanman

    Global platform, the Mazda 3, European Ford Focus and Volvo S40 all ride on the Volvo-developed Ford C1 platform.

    http://en.wikipedia.org/wiki/Ford_C1_Platform

  • avatar
    stanshih

    Skor,
    I’ve been thinking about posting a snarky bet remark and you just asked for it. I’ll bet, err… I mean subscribe to TTAC for $50 if GM goes bankrupt before Ford.

    Mr. F, an interesting excercise may be a poll/futures market concerning odds of Ford and GM bankruptcy, brand axeing (Mercury, Buick, etc.)

    Nino,
    I actually think the Freestyle is actually a very sensible alternative to a large SUV and the 500 looks OK to me too. But it doesn’t matter what you or I think. Those cars aren’t selling.

    Meanwhile few people around here think much of GMs Impala, G6, Malibu and Cobalt. But they ARE selling, apparently (going by July ’06 sales data).

    Also an unscientific observation a la Joe C:
    There are many new Impalas, G6s, Cobalts and SAABS on the roads here in the NYC metro area. (And no, they’re not all rentals and police cars =) )

  • avatar
    210delray

    It’s hard to believe that 7 short years ago Ford seemed poised to pass GM in global market share to become the new #1. Oh, that halycon year of 1999, before the Explorer/Firestone mess, terrorism in the US (ignoring that homegrown monster McVeigh), the stock market crash and continuing malaise, Bush and Iraq, $3 gas…how the mighty have fallen!

  • avatar
    nino

    “Nino,
    I actually think the Freestyle is actually a very sensible alternative to a large SUV and the 500 looks OK to me too. But it doesn’t matter what you or I think. Those cars aren’t selling.”

    Other than the styling, I can’t figure out why. The Freestyle is based on the Volvo XC90 platform and that car seems to be a favorite of those who prefer Euro SUVs. But you’re right in that nobody cares what we think.

  • avatar
    Don Whitefield

    The US companies have a very good reason not import small cars like the Focus from Germany. You guys forget that cars are going for a lot more money in Europe than in North America. There is not much of a profit in small cars to start with and it completely disappears when shipping european made cars to the US. They also have to be fitted and certified to comply with the rules over here.

  • avatar
    nino

    Don Whitefield says;

    The US companies have a very good reason not import small cars like the Focus from Germany. You guys forget that cars are going for a lot more money in Europe than in North America. There is not much of a profit in small cars to start with and it completely disappears when shipping european made cars to the US. They also have to be fitted and certified to comply with the rules over here.

    I don’t believe that importing these cars is the intent of posters who have shown preference for these models.

    In the case of the Euro Focus, Fiesta, and the Ka, the intent is that they be produced in this country (or Mexico) in the factories that are producing the present Focus. Since the Euro Focus is based on the same platform as the Mazda3 and Volvo S40, US certification, at least for that model, shouldn’t be a big concern.

  • avatar
    James2

    What Bill Ford needs to do is fire everyone who works in Dearborn and do a wholesale importing of Ford of Europe’s lineup.

    The Ka/Fiesta would run rings around the Yaris and Honda Fit. Everyone already knows how good the Euro Focus is… it’s called the Mazda 3. Coming soon is the next Mondeo, which makes the Fusion/Milan look so 20th century. There are a pair of minivans, er, whatever… called the S-Max and Galaxy that make every other minivan on the road look ancient.

    Oh, and replace the Crown Victoria with the Australian Falcon.

    About the only North American products this new-and-improved Ford need carry is the Mustang, Escape and the F-series. The Econoline can be replaced by the Euro Transit.

  • avatar
    jerry weber

    with all of the gm news, we forget Hery’s old company. I believe as many of theabove writers that gm and ford are destined to be importers of captive brands in the future. Look at lincoln, as another writer said 7 years ago Ford was within striking distance of GM, in that time frame they actually passed Cadillac as America’s largest seller of luxury cars. The division that is melting away fastest is Lincoln mercury. They go from 200,000+ lincoln units to about 100,000. My friends these are not focus sales these were $40,000 units as Lincoln didn’t have a stable of rebadged mazdas back then. Lincolns were highly profitable. The town car is history last unsuccesfully reworked some 7 years ago, like taurus it was the engine that pulled the train. What does a company say that trashes the #1 selling car taurus, and the #1 selling luxury car? How many chances do you get in a business where the competitors are already two model cycles ahead of you? Who do we nowblame? In the 1930′s they blamed old Henry for not changing with the times and blowing his lead to GM. It won’t matter, will it? Even the mustang, it was clean, fresh and renewed two years ago, now seems to look well old like it’s imitated 1964 progenitor. AS for the F150, for 25 years Gm has played catch up, now with new products from chevy, gmc here goes another lead down the tubes. ( however if gm, ford , and chrysler ever think pickup trucks will come back to where they were they truly should retire. I came back from a five day vacation and found gas to be 10 cents higher.) No it’s over, and yes maybe ford has been given a free ride while we all watch GM’s death watch.

  • avatar
    chanman

    Maybe what we need is an automaker dead pool. One for the companies proper, and one for brands.

  • avatar
    jerry weber

    p.s. update on my fuel cost comment, BP has just announced that Prudhoe Bay Alaska is shutting down indefininetly for repairs. That’s 8% of all gas for the U.S. Forget the $3.00 gallon and think $4.00. This is if all goes well, however the “Wall Street” crowd are saying buy Xmas we will see prices crash to $60.00 a barrel. Believe that and you can join the Auto execs in their market share predictions for next year. Let me give you an even scarier prediction, if Israel or America attack Iran there will be no gas for a protracted period. Any fuel would have to be allocated for power generation and defense. What little there is would be $10.00 to $20.00 per gallon. Now the prius brings $50,000 per copy on the black market newly redesigned silverados bring $0. It’s a long shot, but so is the prediction that fuel goes back to “old levels”.

  • avatar
    geozinger

    jerry weber:

    A lot of what you posted there is speculation. There’s no need to ratchet up the anxiety.

    I do have a question for BP however…

    WTF?

    Don’t they pay someone to assess the pipelines and keep this kind of thing from happening?

  • avatar
    hdroofer

    Ford will never file chapter 11. I am not an attorney but, I am reasonably certain that if Ford were to file bankruptcy, the Ford family would lose their controlling stock in which case, the family members would have to actually find jobs they are qualified for. Aint gonna happen.
    Willy Clay ran the Detroit Lions for years before he took over Ford and look how well that turned out.

  • avatar
    Glenn

    It does not take too much of a stretch to imagine the possibilities behind the BP oil line “leak” which will supposedly take “weeks” to fix. Leaks surely don’t take weeks to fix, whereas sabotage (like an explosion) might. But of course, this is more speculation. However, many of the explosions in Texas at refineries over the last year have seemed rather – um “suspect” to me. Plus, we know terrorists have actually tried to destroy Saudi facilities.

    I’m guessing this is why gas was $3.13 this morning in my town, about 13 cents or 4.5% higher than the national average. I’ve just checked http://www.hybridcars.com and looked, and at least we are now a penny less than the Californians today – last week, we were about 3 cents a gallon HIGHER than California in my northern Michigan town.

    That’s what I get for my parents moving to a beautiful area in 1970, and my moving back 14 years ago – it has become a tourist trap and gas prices are the highest in Michigan. Lucky us.

  • avatar
    geozinger

    Glenn:

    I’m in Grand Rapids. The gas price this morning?

    $3.19.

    This evening?

    Who knows.

    I’m betting as this BP issue continues, we’ll see higher prices yet…

  • avatar
    jerry weber

    to geozinger & glenn You are not reading what’s happening in Alaska. The pipe is not leaking, it has lost 3/4 of it’s thickness due to corrosion. It doesn’t need to be patched but totally replaced. This will take months. The only question is how come now they notice 3/4 of the metal gone ina pipe?The pipeline is already 100% shutdown and there are no predictions as to the reopening time. This is huge, not speculation. We lost 8%of our oil, thank you BP for being the modern foreward thinking scientific company who neither saw this happening or figured out a way to stop the corrosion when say the pipe was sayonly 10% eroded.

  • avatar
    gbh

    The best part is BP (theoretically) pumped millions of gallons of corrosion inhibitors through those pipes every year.

    Ooops.

    I’m with ya Jerry, I love that BP says that they were “surprised” and “never expected” that kind of damage.

    You’d think that there would be some sort of regular testing of a pipeline that is kind of critical. But, that’s just me.

  • avatar
    jerry weber

    Update on the Alsakan pipeline. It seems BP last cleaned it in 1992. Even my house was cleaned more recently than that. The competitors have also used an internal probe to look from the inside, BPO thought it was expensive and did ultrasound from the outside. In any ordinary business, you lose product you lose profits, not so in the oil business. You now sell the lesser amount you can deliver for more money. It may prove profitable to have the line down for a few months. And you thought the BP execs weren’t the brightest bulbs on the tree.

  • avatar
    geozinger

    jerry weber writes:

    “In any ordinary business, you lose product you lose profits, not so in the oil business. You now sell the lesser amount you can deliver for more money.”

    Amen brother.

    I guess this is all part of the plan to move “beyond petroleum”…

  • avatar
    chanman

    “In any ordinary business, you lose product you lose profits, not so in the oil business. You now sell the lesser amount you can deliver for more money. It may prove profitable to have the line down for a few months. And you thought the BP execs weren’t the brightest bulbs on the tree.”

    BP *does* lose money – they have a lot less oil to sell.

    The ones that profit are competing oil companies that get to face the higher price with their own supplies undiminished.

    That’s why cartels are hard to put together – if everyone tightens production, everyone gets to reap higher prices. But if everyone else tightens production, and you don’t, you get to sell more at a higher price.

    If OPEC tightens the screws again, the big winners will be non-OPEC oil producing countries like Russia.

  • avatar
    jerry weber

    I didn’t mean ato get technical in all of this oil analysis, but to point out the terrible fragility of the supply pipeline (literally). Here we have companies depending on 35 gallong tanks in trucks to be filled economically and easily to justify selling these rigs. I would love to know the percentage of people who really need these trucks for carriage and work and those who like to ride in them. It’s the latter who will be dumped out in an extended fuel crisis. In either case the big v8′s are doomed because even the industrial users will demand diesels for these light trucks. Then we get to cars which also must become more efficient to survive. If the American companies think that this is only a passing fancy, they will be history.


Back to TopLeave a Reply

You must be logged in to post a comment.

Subscribe without commenting

Recent Comments

New Car Research

Get a Free Dealer Quote

Staff

  • Authors

  • Brendan McAleer, Canada
  • Marcelo De Vasconcellos, Brazil
  • Matthias Gasnier, Australia
  • W. Christian 'Mental' Ward, Abu Dhabi
  • Mark Stevenson, Canada
  • Faisal Ali Khan, India