By on August 7, 2007

hank.jpgLast week, Ford exceeded Wall Street’s expectations by reporting a profit. A profit! As in, the American automaker took in more money than they spent! Pundits unfamiliar with the fact that Ford carries around so much debt it makes Atlas' planetary burden seem like a small backpack, oblivious to the missing ten foot pole marks on Ford dealers' inventory, hailed the news as a sign that the only Way Fordward is up. You know you need to worry when the CEO himself feels obliged to warn stockholders and camp followers that billion dollar losses lie directly ahead. And indeed they do. 

In Q2, Ford reported a $750m profit– a full billion dollars better than last year's second quarter results. Globally, FoMoCo’s finances ended ahead by $750m. Locally, the automaker’s NorAm unit fell into a $279m hole. While it bested the previous year’s $317m negative number, the improvement reflects drastic domestic cost cutting and company sell offs, not increasing sales. 

In July, Focus and Mustang sales slipped into double digit declines. The transmogrified Taurus did little better than it did as a Five Hundred (down 22%). The hecho en Mexico sedans lost their estrella status (Fusion -31.3%, Milan -36.2% and MKZ -11.5%). The cross-border crossovers found almost 4k less “Dave” like drivers than the month previous. And the F-Series looks set to decline some 200k units by year’s end. Despite incentives and zero percent financing, Ford's U.S. sales are slumping across the board: down 19 percent.

Given that The Big 2.8 are now fighting each other for less than 50 percent of the U.S. market, anyone who thinks Ford is poised for a profitable comeback is certifiably delusional. They just don’t have the goods. This paucity of product is a problem both now and, more worryingly, for the foreseeable future.

According to Merrill Lynch’s annual “Car Wars” study, The Blue Oval Boys are destined to place dead last in projected product replacement rates. Merrill’s analysts reckon Ford’s “Showroom of the Future” will be the oldest lineup in the entire U.S. car biz from 2008 to 2011.

The industry average total lineup replacement refresh rate currently hovers around 67 percent. Dearborn’s developers displace a mere 57 percent of moribund metal. FoMoCo just isn’t spending the money needed to compete in today’s fast-changing, endlessly evolving automotive climate.

As the F-150 proves, Ford knows how to refresh their vehicles. As the upcoming Fairlane demonstrates, they also “get” new models. It’s just that “Ford does not have the financial or managerial resources to keep plowing time and money into all its brands.” 

This piece of wisdom arrives courtesy Jonathan Steinmetz. Morgan Stanley’s automotive analyst is part of the growing consensus that Ford wants needs to sell Jaguar and Land Rover by the time the kiddies head back to school, while Volvo should be under someone else’s supervision by Christmas break. 

A shortlist of bidders has already begun poking and prodding the (un)balance sheets of the British PAG contingent, while Volvo is under “strategic review.” Mulally will try to protect Ford’s mechanical umbilical cord to the Volvo, but these are desperate days. Bottom line: FoMoCo is looking to unload all three beneficiaries of its ill-advised, mismanaged expansionist ambitions for about $16b.

Ford needs the money. Much of the automaker's $37.4b bank balance is already allocated. The Glass House Gang are spending $1.5b per year just to service their astronomical debt. While cheaper than ever before, the Way Fordward turnaround plan will still chip away an estimated $15b to $16b before its fiscal finale. That leaves Ford with just over $20b to keep their motors runnin’. Unfortunately all that and then some may be needed to fund the UAW’s September settlement.

The mavens at Morgan Stanley figure Ford currently carries a $30.9b (and growing) retiree health care burden. One of the key points in the current collective bargaining talks: excise that encumbrance by placing it into a union controlled trust fund (a.k.a. VEBA). It’s a “solution” that won’t come cheap: a one-time $25b cash and stock hit ought to do it. Short term pain for long term gain, no doubt. But any such payout would make things tighter than a duck’s ass in Dearborn.

If and when all these deals drop, if and when seven dissolute brands become four more tightly focused divisions and a UAW health care settlement goes down, FoMoCo could be sitting on as little as $10b at the start of 2008. As GM board member Jerry York pointed out back when The General was scraping the bottom of its barrel, that’s hardly enough money to keep the lights on. Ford would be living a day-to-day, hand-to-mouth existence.

That’s assuming the company generates quarterly results close to the plus side of the general ledger. As Ford CEO Alan Mullaly warned when Q2’s numbers were released, that prospect is highly unlikely. 

Ford is now in the toughest quarter; facing rising commodity prices, a weak housing market, higher borrowing costs and unreliable pump price fluctuations. Refreshed F-150 or no, Ford’s aging lineup will be hard pressed to hang tough, never mind return Ford to its days of thunder. In fact, FoMoCo’s second quarter profits are merely a blip on the life monitor of a terminally ill patient.

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35 Comments on “Ford Death Watch 36: What Profit a Man?...”


  • avatar
    indi500fan

    I think Ford and GM just got some breathing room. Bob (200 mil) Nardelli should pretty much be a lock to run Chrysler into the ground in a few years. Sort of like hiring Barry Bonds to be the spokesman for your “all natural” vitamin supplements.

  • avatar
    GS650G

    I am surprised Mustang sales are going down, they had three shifts building those cars to meet demand 2 yers ago. But having no follow up to the ’68 stang look is the problem.

  • avatar
    nonce

    Ford’s long-term plan may be to have their foreign operations support their domestic operations, until their legacy costs go away (i.e., the retirees all die.)

  • avatar
    BostonTeaParty

    What happens when theres nothing left to sell for Ford to stay alive, or will they sell off Lincoln and Mercury? Wasn’t Volvo linked in to any refinancing deal they did though? They’re cash burn sounds far worse than GM’s, take your pick as to who’s in the frying pan and who’s in the fire right now.
    As a matter of interest has there been a deathwatch/article on GM/Ford leaving the NA market has anyone run over the global figures if someone dared do the unthinkable. Could the companies survive without NA?

  • avatar
    KatiePuckrik

    Whilst Ford making money is a good thing, it couldn’t have come at a worse time. Now how are they going to (seriously) ask for concessions from the UAW when they’re posting a profit?

    And let’s not forget that Ford still retain control over their finance arm (unlike GM) so no doubt they majority of their money has probably come from that division.

    Despite the so called “record sales levels” they’re achieving in Europe, these (like GM as I said in a earlier post) sales have all come at heavily discounts prices. I’m talking £4500 off a Ford Focus R.R.P £17000. Not to mention that the US dollar is incredibly depressed against other currencies which increases profit margins. So it’s entirely plausible that Ford have sold the same amount of vehicles abroad, it’s just the profit margin increased through weak dollars! So all you domestic fanoboys crying foul about a weak Yen, just remember, the United States has the same advantage….

    Like Mr Neundorf says, it’s all about product. Product, product, product. Ford keep crying about how they have an unfair “perception gap” but yet have done NOTHING to get customers back, in my opinion. Saying you’ve won a load of awards that no-one trust nor cares about, isn’t enough and rather arrogant. Ford believe that a few empty words (and awards) will smooth over all the customers they’ve burnt. Take a leaf out of Hyundai, put your money where your mouth is! MAKE me want to buy your products. Issue me with a 5 year warranty. Give me an incentive (bad choice of words!).

    Actually speaking about quality and reliablity, Ford recently announced another recall for 3.4 million vehicles for the dodgy cruise control which can set fire to your car (and your garage, house, dog, etc). This brings the total number of vehicles recalled for this problem to about 10.4 million. Making it the largest automotive recall in United States history. Way to go Ford(!)

  • avatar

    I think Ford has the most desirable lineup of the North American manufacturers at present (except for the upcoming redesign of the Focus, BARF) and I for one am pulling for them. Strange, because I grew up a GM type of fellow, but I’ve basically abandoned them and Chrysler to the 3-headed dogs… and bankruptcy.

    I think at this point a bankruptcy wouldn’t be too bad for any of the Big 2.8, after watching the airlines use bankruptcy to screw all their labor, decrease service and increase prices for eventual profit I think it is a good option.

  • avatar
    Nemphre

    So if they sell Volvo, does that mean Mazda is fair game as well? Apparently the whole product integration thing doesn’t mean a whole lot when you’re raising money to keep the sinking ship afloat.

  • avatar
    jurisb

    Ford actions v reality( lost in translation).

    ford- we diversify our product range.
    reality- we rebadge either obsolete agonizing platforms or imports.
    ford- we improve quality.
    reality- decreasing domestic components automatically improves quality, because there can`t be a part worse than stamped in the NA.
    ford- we cut costs.
    reality- we count beans. we make shoddy look appealing. we don`t engineer, we use other manufacturers.
    ford- we reduce new car launch cycles.
    reality- if mazda builds a platform fast, so does our cycle. as we participate less and less in engineering, sure cycle shrinks.
    ford- we offer competetive prices.
    reality- the only reason half- educated people still buy fords are discounts.
    ford- Lincoln is a premium american brand with hot new products.
    reality- lincoln is a premium mazda derived brand, and new products will have to do with ford less and less.
    ford- our reliability has improved.
    reality- the more non- domestic components, the better for reliability.
    ford- we are the second biggest american car manufacturer in NA.
    reality- we look like american manufacturer because we have american history, logo, and names, yet what is trully american is actually becoming a history.
    ford- we are competetive in many segments.
    reality- we are competetive in the segments of patriotism, where people don`t know the truth of the real origin of our cars. we are competetive in visual value. ( looks big shiny, and chromed).

  • avatar
    jurisb

    Ford actions v reality( lost in translation).

    ford- we diversify our product range.
    reality- we rebadge either obsolete agonizing platforms or imports.
    ford- we improve quality.
    reality- decreasing domestic components automatically improves quality, because there can`t be a part worse than stamped in the NA.
    ford- we cut costs.
    reality- we count beans. we make shoddy look appealing. we don`t engineer, we use other manufacturers.
    ford- we reduce new car launch cycles.
    reality- if mazda builds a platform fast, so does our cycle. as we participate less and less in engineering, sure cycle shrinks.
    ford- we offer competetive prices.
    reality- the only reason half- educated people still buy fords are discounts.
    ford- Lincoln is a premium american brand with hot new products.
    reality- lincoln is a premium mazda derived brand, and new products will have to do with ford less and less.
    ford- our reliability has improved.
    reality- the more non- domestic components, the better for reliability.
    ford- we are the second biggest american car manufacturer in NA.
    reality- we look like american manufacturer because we have american history, logo, and names, yet what is trully american is actually becoming a history.
    ford- we are competetive in many segments.
    reality- we are competetive in the segments of patriotism, where people don`t know the truth of the real origin of our cars. we are competetive in visual value. ( looks big shiny, and chromed).
    ford- we share components with our subsidiaries.
    reality- we take as many components from foreign manufacturers as possible, because we bought their stocks, so we can. they don`t ask anything from ford engineering. why would they? Are we a car company or something?

  • avatar
    jthorner

    “I am surprised Mustang sales are going down, they had three shifts building those cars to meet demand 2 years ago.”

    I’m not surprised. All of the aging boomers who wanted a new old look Mustang bought one, now they don’t need another. Much like the New Beetle this product was always destined to be a one-hit wonder.

  • avatar

    BostonTeaParty, you can’t leave the North American market. Remember the dealers? You have to supply them with product. You want to go ch11. What about the real owners the stock shareholders?

  • avatar
    BostonTeaParty

    Sherman, do you mean the dealers that need trimming down anyway? what about the stockholders if you hit bankruptcy, what about their returns if they get pennies on the dollar If they’re lucky. In fact what about them, maybe some sacrifice for future good of the company and their returns for the future instead of right here right now, and worrying about quarterly results for once.

  • avatar
    Bunter1

    JTHorner-“I’m not surprised. All of the aging boomers who wanted a new old look Mustang bought one, now they don’t need another. Much like the New Beetle this product was always destined to be a one-hit wonder. ”
    Yup.
    With the new 3.5 at the launch, IRS, a modern interior, and some weight loss (I think the styling could have worked fine) the base model could have been a bargain 3 series alternative. Might have actually drawn in non-Ford, import oriented customers (you know, the ones they NEED to win back).
    The 17 guys who wrote them 2000 letters/each to keep the live axle would have been pissed but they won’t be putting a new car next to their trailer anyway.
    Why look to the future when the past was so beautiful…oh, you don’t get the option to live there do you.

  • avatar
    Matthew Danda

    If you had to buy a domestic car, would you buy one from an accountant (Wagner), a temporary consultant (Nardelli), or an engineer (Mulally)? I choose the Engineer. Ford is the best domestic, in my opinion. At least they got that going for them.

  • avatar

    BostonTeaParty The only way to cut the dealers is to go ch11. If you do that the shrs are wiped out. So go ch 11 wipe out 95% of whatever value the stock is now. Wipe out the real owners, screw over your dealer network (yes I know it is bloated), just so you can keep the company going for the employees benefit.

    GM and Fords employees allegedly work for them but it obvious how corrupt the culture at GM and Ford have become.

    Like it or not they (the stock holders) are the owners.

    I am amazed at the GM managers and engineers that will blame the UAW for the problems, blame them for being self centered, selfish etc and then without a second thought advocate flushing away excess dealers because they are now inconvenient. It doesn’t matter if they carried your company through hard times. it doesn’t matter how long they have been a dealer, it doesn’t matter how much money they have invested.

    The me me culture of entitlement is blamed on the UAW but it seems alive and well and its not just the UAW

    It really bothers me that many employees of GM or Ford whether they are UAW, management, the engineers etc seem to have absolutely no concern about the stockholders, you know the real owners. If it really came down between one of two parties remaining at GM at the end of the day. The owner or the employee? Which should be the last standing?

    I am not advocating this solution, but if it came down to it, the owner should remain and the employee should leave. Why don’t they just outsource virtually all functions, management, engineering etc. Why shouldn’t they do this prior to considering bankruptcy? Why should the owners be wiped out just so the salaried and hourly employees can stay?

    Am I the only one who sees it this way?

  • avatar
    postjosh

    despite what the ford-bashers here are writing, ford’s product is generally much better than the other domestics. there is room for a survivor in north america and ford is by far the strongest candidate. They have good platforms that they will improve until they get them right. isn’t that the strategy that worked so well for toyota? there is a lot of fat to cut and mulally is working on it. he succeeded at controlling costs at boeing and he will succeed at ford as long as the cash horde holds out.

  • avatar
    BostonTeaParty

    True Sherman, but if the owner stays and there is no employee to run your business what good is your money or business doing then. I’m trying to think long term with hopefully more economic gain then, than all the short term problems and losses. I’m not saying chapter 11 i asked if you could walk away from NA or at least reduce your cost base here, i’m sure there are ways to remove dealerships, its one of the many thing staht needs to happen.
    To be honest employees know that the US auto industry is fighting to survive and the last thing we feel should be happening is having to worry about stockholders and dividends, when such money can help save and then improve the companies, (look at GM announcing the non payment of dividends last year) people who have shares in GM/Ford knew the risks and still know these risks when the long term benefits outway the short term pain. And that includes employees of all said companies who hold shares too.

    Yes, excess dealerships are inconvenient as has been advocated by many an article and submittee of comments on this site. I can also see, like you, many functions being outsourced, manufacturing has already started and i wouldnt be surprised to see this completely gone from all NA American auto companies, as the UAW will never get flexible to adjust to the modern world. Engineering would be more difficult just because of the enormous amount of man/woman power required to get a vehicle into production and the same with design.

  • avatar

    So how can you just walk away from North America? So you don’t go ch 11 you just stop making cars for North America?

    Again what about the dealers? Just screw em stop making cars for them? So if they stop making cars for North America, should they lay off all North American operations personel including engineers? Everyone except the very top management.

    What logic would have them keep any North American engineers if you don’t sell anything in that market?

    As for dividends, of course they should be cut when the company is not making money, but GM has been playing that we are in this for the long haul song and dance for years all the while sidestepping questions about their substandard performance.

  • avatar
    Brendan

    Ford has a better showroom than the other domestics right now, but the housing market is really the biggest enemy. They are too truck reliant. I think the Flex will go over fairly well, and it doesn;t hurt that gas prices are expected to be stable for the next quarter or so, but they have got to spend money on getting the Fusion et al where it needs to be or it’s lights out.

  • avatar
    Rick Korallus

    It appears that even Automotive Snooze believes the hype, check out this from the NADA Headlines:

    Ford Motor Co.’s quality gains in the past year are contributing to major savings on warranty costs, the company’s North American manufacturing chief, Joe Hinrichs, said. Ford Motor posted a $700 million warranty-cost improvement in the first half of the year as successful launches of such products as the Ford Edge crossover and renewed attention to electrical and powertrain components took hold, Hinrichs said. Hinrichs … said Ford has benefited by standardizing manufacturing processes across plants and through greater use of computers to foresee production obstacles. But teamwork with Ford’s unionized work force may be the biggest reason for improvement, he said. UAW locals at every Ford plant in North America have instituted flexible work rules codified in competitive operating agreements, Hinrichs said. The agreements, which reduce job classifications and promote team building, are expected to save Ford more than $500 million annually.

    Source: Automotive News [return

    The past is about to bite them (Ford) in a dark, warm moist place, where their heads have been burried for soo long. If anyone gets the Snooze, does the reporter do his/her journalistic duty and ask the tough questions concerning the latest recall? Or are they just spewing the fluff they were fed by Ford?

  • avatar
    Dave M.

    All of the aging boomers who wanted a new old look Mustang bought one, now they don’t need another.

    I resemble that comment. However, the ogling of my car is by (mostly males) of all ages. Seriously.

  • avatar
    hltguy

    Rick Korallus: The comment in the article that “teamwork with Ford’s unionized workforce may be the biggest reason for improvement” They are kidding right? I know people who have friends who work within Ford plants and are always telling me the morale is awful, laziness abounds, and there are constant quality problems arising. The car buying public for the most part does not read small circulated automotive publications, but they do read the newspaper and hear the news when Ford recalls another three million vehicles. They do read Consumer Reports and their ratings of Toyota, Honda etc, particulalry in quality on the longetivity side of things compared to the “domestics”. They do find out about resale value, by simply looking in their local newspapers as to what used vehicles are selling for. They do know about crappy dealer service over the years from crappy products with crappy warranties that weren’t honored without a big fight. They do talk to their families and friends about their car experience and it would be probably safe to say that the 2.8 get less favorable word of mouth reviews than Honda, Toyota etc. Just as negative word of mouth can kill a new movie release or a new restaurant, it can kill car companies. It just takes longer because they are so much larger. For every Toyota engine sludge problem, there is the Ford Pinto, Chevy Vega, Ford Explorer, Citation, Cimmaron, Aztek, Cavalier etc. etc. Market share doesn’t lie, from eighty plus percent to under fifty percent in two decades is proof positive that the chickens are coming home to roost for the 2.8.

  • avatar
    Gardiner Westbound

    It really bothers me that many employees of GM or Ford whether they are UAW, management, the engineers etc seem to have absolutely no concern about the stockholders, you know the real owners. If it really came down between one of two parties remaining at GM at the end of the day. The owner or the employee? Which should be the last standing? – Sherman Lin

    The entity that really counts is the customer. Without him there are neither employees nor shareholders, as the domestic automakers are finding out. Customers are wreaking vengeance upon them for decades of lousy cars and worse customer care.

    The automotive executives looked after themselves and Wall Street, the union looked after the line workers, and now the customers are looking after themselves buying quality products from the transplants. What goes around comes around.

  • avatar

    Gardiner Westbound I agree with you, the customer is Number 1. I was just responding to what I see as increasing calls for ch 11 to get out from the obligations to either the UAW or to rightsize the dealer network.

    It just simply was anazing to me the casual way that many people that work in the industry seem to have no problem using ch 11 to be rid of either the dealers or the union. They call for ch 11 with no regard for the actual owners and as a former small business owner I am appalled at the screw everyone else attitude.

    I am a former GM owner and currently a very satisfied Toyota (Scion 1st gen Xb) owner who switched over from Honda after being very satisfied with them with two Accords. I switched because I wanted a car like the Xb and the Fit was not yet available.

    When I bought my Xb in 2005 it was the first time I never even looked at a domestic. You can’t sell when you don’t have what I want. Supposedly people don’t want small cars according to Detroit. They don’t care about me as a customer so why should I care about them?

    Where are GM’s world class, best in class small cars? Oh thats right that don’t have any and never did. At least the Ford Focus was a good car when they brought it out.

  • avatar
    Gardiner Westbound

    …it was the first time I never even looked at a domestic. – Sherman Lin

    Ditto. The domestic automakers’ poor quality history and abysmal warranty track record persuaded us to bypass them when selecting our two most recent cars.

    http://www.pistonslap.com/

  • avatar
    CliffG

    With a stagnant product line for the next three years, it really doesn’t matter what miracles Mullally can perform on the production line. For what it is worth, actual production line salaries/pay scales have been roughly equal amongst Japan, the US and Germany since the late ’80s. This excludes the transplants obviously.

    The good news is that of all of the widget managers, Mullally is probably the best one of the bunch. Where did all the car guys go anyway?

  • avatar
    drifter

    All of the aging boomers who wanted a new old look Mustang bought one, now they don’t need another.
    Perfect timing for GM to launch the Camaro…NOT

  • avatar
    50merc

    My compliments to Mr. Neundorf (or whoever) for choosing the perfect photo (Henry on his famous “Quadiricycle,” right?) and caption (“the burden of history weighs upon them”) to accompany this editorial.

    Ford Motor’s fabulous history is without parallel in American industry. The first Henry, eccentric to the point of craziness, who put the world on wheels with Fordism but brought a stunningly successful firm to the brink of extinction–twice! Edsel, the Ashley Wilkes figure whose talent was sadly wasted. Henry the Deuce, who took the firm into the modern world. Jacques Nasser, blundering empire builder who squandered billions. Bill Ford Jr., a well-intentioned nice guy but a weak executive who forgot a CEO’s first obligation is to tend to business rather than gardens on factory rooftops. What a cast of characters! Now Ford’s story is playing out like a Greek tragedy.

    My hope is that Ford can avoid bankruptcy. That would be very painful for a lot of people. But I’m afraid it may be inevitable. The burden of history is but part of the heavy load that could sink Ford’s North American operations.

  • avatar
    whitenose

    50merc: let’s not forget Lido, who grew up at Ford before the Deuce personally fired him.

    Also, as I understand it, Edsel’s talent wasn’t wasted, so much as compressed and sedated.

  • avatar
    Glenn 126

    Also not forgetting Bunky Knudsen, who was Ford’s ‘pretend’ President in the late 1960’s and early 1970’s for a while – until Henry the Duece fired him (mostly because his last name didn’t start with F end with D and have an OR in it).

  • avatar
    Martin Albright

    What happens when theres nothing left to sell for Ford to stay alive, or will they sell off Lincoln and Mercury?

    Sell Lincoln and Mercury? Who in God’s name would buy them?

    I suppose FoMoCo might be able to sell Mercury if they threw Jill Wagner in with the deal, but otherwise, I wouldn’t hold my breath waiting for someone to bid on Lincoln/Mercury.

  • avatar
    Rick Korallus

    hltguy: I didn’t call them “Automotive Snooze” for nothing! The whole situation is pretty sad, but amusing in a twisted sort of way!!!

  • avatar
    BostonTeaParty

    Sherman, the customer is always number one, i never mentioned chapter 11, you did and all i did was wonder out loud that if the UAW are not going to be reasonable on manufacturing practices why not leave the NA and reduce the monkey on Ford and GMs backs to be able to return to a state that means they are competitive. People say that the UAW are not to blame, but if they will not embrace working practices that allow the company to act in a modern efficient way, who is then. Cost cutting is working, new product is getting there the next piece of the puzzle is the UAW aswell as working on stopping the slump in sales which also affected Toyota recently.
    Sometimes you have to do nasty things for the good of the many that affect the few.

  • avatar
    jurisb

    how can you sell mercury brand if it doesn`t have even a single its own model? How can you sell lincoln if all it has is heavy-mascara -job mazda face liftup?
    guys ,you should also count how many models each of the japanese companies sell, and what a surprise , honda, mazda or nissan doesn`t do cross- dressing and don`t rebadge each other models. While all american car manufacturers come down to 3 brands , for their exteriors are so heavily rebadged, that actual amount of real models within each subsidiary is mega-tiny. And it is ridiculous saying that ,`say` GM has too many models. look closer- how many models does Saturn have that wouldn`t be a rebadge version of a foreign car or its own subsidiary? Eon? GMC? how many models? Do you realize that the whole range of models gm offers is similar in amount to Honda or toyota( without lexus or scion or daihatsu or hino)? And good luck, Toyota has plans unfolding Prius as a seperate brand.
    And would you really consider Mercury a real brand ? What diversity does Lincoln offer ? what unique sheetmetal does it have, and how many models?
    DETROIT, YOU CAN`T SELL 8MILLION UNITS A YEAR IF YOU DON`T HAVE THE REAL DIVERSITY OF MODEL RANGE, THAT HAS ITS OWN BRAND-UNIQUE SHEETMETAL. ( you can share door handles, seat rails or steering columns as much as you want, But if i can swap the front door of a premium licoln with base Fusion, it kills your status. )why don`t you put more realistic ad slogans, forget the bold moves, make one like this ,at least it will be true-` We build our lincolns on mazda platforms and engines and trannies, because we are too lazy and stupid to engineer anything with mechanisms ourselves. at the moment we are downing sodas and munching chips , wobbling our bellies and making speeches of the century about global parts sharing of ford go-ahead cost cutting program to remain competetive`

  • avatar

    BostonTeaParty I was just responding to your musing about abandoning the North American market. I don’t think any of the former big 3 can. They have an obligation to their dealer network.

    I only mentioned ch11 because that might remove the legal obligation but not the moral one. However, it is my sincere opinion that there is one underlying principal that got the former big 3 into the mess they are in today. That is to take the stance “screw this person or group as they don’t matter and they are inconvenient.”

    That’s what lost you one customer at a time. You cannot systematically screw over your customers, your suppliers, your dealers and your workers, both salaried and hourly and your owners without long term ramifications.

    I simply point out, that to take the view “well screw this group” will not only not work but it is the very line of thinking that got the Detroit 3 where they are today.

    You can’t simply screw over you dealers in flippant not give a damn way. I don’t work in the industry and I also hate car dealers but I can’t stand seeing company insiders just without a second thought just write off people that are allegedly your partners without a second thought.

    Why would any potential customer buy a car from a company that not only would screw someone over the second they could, but that had a long history of doing so?

    Oh and don’t be fooled by union rhetoric, they usually are hardline when you have to make concessions. I fully expect that they will make the necessarry concessions. If they don’t then they will ultimately suffer even more.

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