Ford Calls For Harmonized US-EU Vehicle Standards, Will Help Niche Vehicles

@DocOlds It's been a pleasure debating you. You do have knowledge of the industry. One thing though, seriously dig into the EPA site and look at the difference between gasoline and diesel engines in regards to pollution. You'll be surprised. If the US adopts the UNECE you will not lose you big pickups and muscle cars, look at us, we sell them to you. The UNECE will make it cheaper to produce vehicles like the Chev Colorado that are getting a 'make over' at the momnent. I think its quite sad that an already designed vehicle has to be redesigned for another market. Someone is paying for that waste.

@doctor olds - I have to agree with Big Al and it's been a pleasure debating with you. I also agree you have knowledge of the industry. The fact that you were ignorant to the existence Chicken tax only proves how irrelevant it really is. I don't think anyone knew it existed until the mini-trucks and then mid-size trucks markets became a skeleton of what they once were. Then fans of mid-size pickups started looking for excuses and called full-size "protected" when all the while the Ranger, S10, Dakota, Frontier and Tacoma have also been supposedly "protected". Did something change that ( almost all at once) encouraged Mitsu, Mazda, VW, Subaru and Isuzu compact & mini-trucks to come to America then it was taken away? There's reason the Transit gets those "tricks" done to it. For one, it escapes any tariff, and 2nd, IT'S WORTH IT! And it has a business case that works. That right there is the difference between a successful import truck and one that excuses are made for. Don't forget all the wildly successful import medium duty truck lines. Do you hear any of them complaining about any chickens? I agree that CAFE is what started the whole mini-truck craze, but it skyrocketed on its own and crashed on its own. I also agree CAFE needs to die along with the Chicken Tax. CARB needs to die also. Seriously though! And don't get me started on the that damn Sierra Club..

@doctor olds - I'll ask you the question Big Al & Robert Ryan have been dodging for a while: "We can point to a hundred million imports that have sold here and you can not even come up with one specific car or truck that backs up your ridiculous claims?" Start by listing any and all trucks that have been negatively affect by the Chicken tax. Then we'll move on to cars.

@DenverMike I could name a whole bunch of said vehicles sold in Mexico and elsewhere but not in the US... the only compact left on the market is the Nissan Navara. US market realities, the desire of customers for bigger trucks, entrenched customer loyalties and... yes... the Chicken Tax... mean that everyone else has either dropped that product line in favor of a US-made pick-up (Toyota and the Tacoma) or are simply no longer bothering to bring their global products stateside (Triton, Ranger, Hilux, Amarok, etcetera). New Trailblazer? Sorry, not for you .

@Nicky, Thanks, nice summing up.

@Niky - I don't know how to break this to you, so I'll just come out and say it. The Navara is a re-badged Nissan Frontier. It's GM's decision to bring the global Colorado to the US for CAFE reasons, but also favors the Equinox, particularly with the CAFE friendly four-banger over the global Trailblazer. So it seems CAFE cuts both ways. But of course you know, the global Trailblazer is not a 'truck' so would be Chicken tax exempt. There's also a case for trucks like the global Ranger, Mitsu Triton and VW Amarok not having good business cases in the US even after spending just a few hundred dollars on Chicken tax tricks/loopholes (which likely still cost the same or less than the 2.5% tariff all import cars pay anyway). Other than the US market's insatiable thirst for base-stripper regular cabs and preference for mid-grade full-size pickups over similar, hard loaded mid-size... the Amarok, Triton and Ranger would cannibalize more profitable VW, Mitsu and Ford products in the US. The Hilux would be redundant.

@Nicky, Chevrolet think they are on a winner with the Colorado.Good article sums up strategies of the Manufacturers and the current situation. http://www.autoguide.com/auto-news/2012/09/where-did-the-compact-pickups-go.html "GM has stated that the international Holden Colorado and Chevrolet Colorado, will be the base of the North American model. This method of releasing the vehicle in international markets first was used in the global release of the Cruze, Spark and Sonic. It all sounds similar to Fords ‘One-Ford’ strategy, but in regards to the compact pickup, GM is actually following through. “Obviously,” said Tom Wilkinson, from Chevrolet’s Communications team. “There are customers who don’t need the full capability of a full-size truck, and are attracted to a truck that is a little smaller and has better fuel economy.” Wilkinson added that he “can’t speak for our competitors,BUT WE LIKE OUR STRATEGY Also mention Chicken Tax and how it affects the market. Summing up article. "So, will the current market segment leader turn around and stop making the Tacoma, like Ford did with the Ranger? It doesn’t look like it. A new model of the Tacoma is expected to come out in 2014 and feature new engine technology and an updated style. Nissan will also be debuting a new version of the Frontier in the next year or so. That means the compact pickup battle will be on in 2014, but without Ford taking on Chevy, Nissan and Toyota, it just won’t be the same.

@niky Nicky as well the Wall Street Journal 2 days ago had an article on the return of the Small Pickup Truck. http://live.wsj.com/video/a-second-look-at-pickup-trucks-2013-03-11-161152412/9784364A-5FC4-46CA-A3A4-2CCFAE034617.html#!9784364A-5FC4-46CA-A3A4-2CCFAE034617

@niky The question is what trucks were hurt by it, which is how I answered. The business case for international trucks doesn't make any sense in the US because the market grew up around the Chicken Tax and the CAFE loopholes, which pushed customers into bigger, cheaper trucks. This is not to say that it has hurt the US industry in the past. The Tacoma only exists because of the Chicken Tax. So did the US-market only previous Ranger, which diverged well from the global Ranger. What the Chicken Tax hurts is the ability of domestic manufacturers to produce a pick-up that can be sold elsewhere in the world. This artificial divide between the US Market and the global pick-up market means American "domestic"pick-ups are basically unsellable overseas. Global compacts with 1.2+++ ton capacities and 3 ton towing capacities mated to tiny 2.5 liter (or less) engines is the norm out here. The only really American pick-up that fit that bill was the Ranger, but the US Ranger diverged from the global Ranger, and has now been sacrificed so that Ford can keep their "Best-seller" status with the F150, instead of introducing a truck that's lighter and more fuel efficient than the F150 yet larger and worlds better than any Ranger that came before it. - As for loopholes? Well... while you can bolt extra passenger seats in the back of a Transit, unless you're bolting those seats to the bed of the Ranger, I don't see how you can do the same there. Really, it's Detroit's loss. No US-made pick-up can be sold overseas in any kind of volume nowadays. Simply because of the divergence in classes. Sure, part of that is due to unique market conditions in the US, but those conditions were fostered by regulations that favored certain classes over others without letting market forces simply battle it out. That's the same thing that happened with CAFE and SUVs. These distortions are why America's global models are made in factories in Thailand and Korea instead of in North America. Might not hurt the companies who own those factories, but it sure as hell hurts the working man in Detroit.

@Nicky "What the Chicken Tax hurts is the ability of domestic manufacturers to produce a pick-up that can be sold elsewhere in the world. This artificial divide between the US Market and the global pick-up market means AMERICAN "DOMESTIC PICKUPS ARE UNSELLABLE OVERSEAS. I have been saying this for ages. The UAW/US Governments has a very narrow view of success. The more they push for a protective enviromnent the worse in the long run it will become.

@Niky - All you're talking about is lost sales. Now that doesn't necessarily mean lost profits for an OEM, especially if they already sell cars in the US that would be cannibalized by all the base trucks that would sell off the same lot. Mexico's cars are grossly decontented compared to well equipped US. The global Ranger loses out on US sales, but Ford would lose more by having to part with too many base stripper global Rangers to cheapskates on the retail level to fleet buyers like Orkin plus the US gov. And would of course, would cannibalize the F-150. Ford's communications/blogger, Mike Levine stated 23% of displaced Ranger buyers stepped up to F-150s. This means likely half of Ranger sales were just there to cannibalize the F-150. Here's trucks that grew around and got around the Chicken tax: The Mitsu D50 Arrow & Mity Max, Mazda Courier & B-series, Isuzu LUV & P'up, VW trucklet, Subaru Brat & Baja. What changed that made these trucks so wildly popular and very profitable at one time in the US then made them extinct species? CAFE might have varied a touch, but nothing so drastic. And besides that, whatever advantages were given to full-size pickups should have affected domestic compact and mid-size trucks just the same and foreign. Don't forget international trucks like Hino, Mercedes, UD and Fuso that are still going strong in the US despite Chicken tax loophole/tricks and domestic competition. The Tacoma is theoretically protected by the Chicken tax, but sales are pretty weak considering it's the last surviving mid-size. The Frontier is still holding on, but suffers from lack of a regular cab. I mean suffers sales-wise. And since the Tundra and Titan 1/2 tons are also theoretically protected by the Chicken tax and CAFE, why aren't sales booming? Edit: also the Frontier was the only truck in the US, mid or full-size, that did not increase sales after the Ranger died. Speaking of the US Ranger being diverged from the global one, you forgot there was a crew cab with a 5' bed that very closely resembled the global Ranger. It was badged as the Explorer Sport Trac, but was built off the extended Ranger frame. No one cared and it was a complete sales flop. It had an available V8 option too. You wouldn't bolt seats to a Ranger (bed), but it's called a 'complete knockdown kit' (or CKD) like what Mahindra was getting ready to use. Various parts are shipped separate to the truck in bulk containers to be assembled locally. US half tons also have 1.5+++ ton payload, but tow close to 6 tons. That's with a bed, not gross without bed, meaning bare cab-n-chassis trucks. Yeah the Chicken tax does more harm to US OEMs than good. Diverged or not, US trucks can not really be accepted anywhere there isn't a free trade agreement (or FTA like Canada, Mexico, Australia) simply because the Chicken tax sounds so outrageous, though it really isn't. This includes US medium and heavy duty trucks. When certain classes are favoured, encouraging a market change, no distinctions are made as far as foreign or domestic. And mid-size trucks get a free pass vs cars because fully loaded mid-size can and do get similar MPG to full-size pickups. Our relatively low fuel prices shapes the market more than anything.

@niky I can agree that market forces play a huge part, as in Doc Olds' post below... perhaps, even without a Chicken Tax, the market divide would still be there. But since the 70's, US and global car markets have been converging. It's in trucks that they aren't, and yeah, sucks. With just 23% going to F150, Ford is still leaving a lot on the table. While I do understand the business decision behind dropping the Ranger, perhaps a 2.0T Ranger would not cannibalize V6 sales so badly. Oh well.

@niky- the convergence is forced by CAFE. Note that Toyota and VW both had to design cars specifically for NA, Camry and Passat, that are larger than consumers call for elsewhere. If Americans had the interest in fuel economy of other countries, they might want smaller cars, but with today's fuel prices they still go for large, powerful vehicles in huge numbers. One example of how CAFE restricts GM now: the Buick Regal is only available with a 4 cylinder here. A wonderful AWD V6 package is being sold in Europe and can be virtually taken off the shelf and delivered here but for CAFE considerations. Expect more makers to move to smaller engines in America with the roll out of latest CAFE escalation.

@RobertRyan- I don't see these standards as having anything to day with US industry competitiveness. General Motors already generates well over half of their sales from outside NA. I focus on GM details,because I am familiar with details, but the problems that caused the financial depletion of the US makers are gone now, with the lifting of the UAW retiree health care cost and elimination of the the jobs bank. In addition, the new contract and second tier wage rates enable profitable assembly of even the subcompact Chevy Sonic here. Previously, small cars had to be built here for CAFE, despite large losses. Prior to the 2007 Labor agreement, GM's additional labor costs the offshore competitors didn't have to bear were on the order of $10B a year: UAW retiree health care = $7,0B, Jobs bank = $0.8B Small Car Group losses = $2.5B (1.6 million cars @ $1,600 loss ea.) Similar costs for these three areas existed for Ford and Chrysler as well, though quite a lot smaller than GM's bill. This was because GM once employed 800,000 people, including 360,000 at Delphi. Their contract kept GM liable for them even though the business was spun off. Rick Wagoner made the statement in a quarterly business review sometime in 2008: "We can run the business better than our competitors, but not $10B a year better." I expect some shots at Wagoner from this group, but he was right to point out that $10B is a huge nut to crack before breaking even! These labor agreement changes, as I frequently write, are the biggest reason for the profitability of all three US makers today. GM is especially well positioned compared to Ford because of the shedding of liabilities in bankruptcy, like it or not. Sales rankings and market share are for bragging rights, volume generates income. GM has more volume here than anyone else, and is running most plants near peak output, making a lot of money!

@doctor olds. True like all standards do, but it does not guarantee a well built vehicle or a problem free one.

@RobertRyan- The car business is complex. I know it very well from the plant floor to the showroom floor, from the service department to executive suites in global headquarters. No doubt, management is always responsible for everything. I was engaged in assisting the management of GM for many years as an engineer and am well aware of most of the problems GM had, what caused them, and how they were addressed. I understand you read a lot about the business, I lived on the front lines fighting the battles for many years. There are forces more powerful than management- a monopoly union, government, and the macro economy among them. A lot of commenters here don't seem to appreciate that our pickup trucks and large SUVs are still what Americans want. They would be buying larger cars, if they were not killed by CAFE. The only reason our pickups are "unsuitable" for other markets is the very reason they are beloved here: they are big vehicles. The size and the lower fuel efficiency that comes with it, are not affordable most other places. Thus it was for our cars in the past. They were never exported in large numbers because they were too large and too thirsty. Americans prove they don't care much about fuel efficiency by their choice to buy "trucks" in increasing numbers coincident with the advent of CAFE in the '70s when the market began moving from 15% trucks to more than 50% trucks where it remains today.