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Ford Fusion, Lincoln MKZ, Mercury Milan, Automotive News
#145 of 486 Re: Actually Ford... [lemko]
Jul 01, 2008 (7:14 pm)
I think Ford's larger-car lineup is having its lunch eaten right now by Chevy.
But all the cars you mention are essentially 20 mpg cars in town (except Ford Fusion 4-cylinder, and guess which one of these is the only one to show sales increases this year? Yeah, the 4-cyl Fusion), not good at all with the current gas prices.
And the market for large cars is in severe decline now these last 12 months or more, which has even impacted the Toyota entrant in that segment, the Avalon.
I know that Ford has already abandoned its goal of being profitable in 2009, but some "industry analysts" are now wondering if it has a future at all, what with the huge monthly cash burn it is now experiencing as a result of sales screeching to a halt. What was it, down 28% in June, 14% for the YTD? Both worse than average for the market, and the only one clearly doing worse than Ford this year (besides little ol' Mitsubishi) is Chrysler.
#146 of 486 Re: Actually Ford... [nippononly]
Jul 02, 2008 (10:14 am)
The other shoe that hasn't dropped is the earnings report. Ford, GM and Chrysler still make most of their money on the pickups and SUVs. this quarterly report can't be good. i know back in the late 90s Ford was making at least $9000 on each F-Series sold and about $7000 on each Explorer. The Escort (and subsequent Focus) was built at a small loss and the Taurus was break even. I don't think this has changed especially with the rebates and incentives they offer. (GM and Chrysler are in the same boat). Whereas Toyota and Honda (to a lesser degree Nissan) started with cars and added trucks later. So even though the Tundra is not selling now, it won't hurt Toyota's bottom line because they make money selling Corollas, Yaris and Camry. They won't make $12 billion (or what ever the number is) but they will still operate in the black. Honda does a phenomenal job controlling their production which is why they are always one of the most profitable companies based on cars sold. It helps they do not have to deal with union labor, retirees and pension funds.
My prediction: Nissan buys Chrysler before the year end. They are planning a lot of collaboration in the near future. Ford continues to shut plants and layoff workers (that is an easy one); Kerkorian makes a push to takeover Ford. I would not be surprised to see Volvo back up for sale. GM is tougher to predict since they do have the cars and research to survive. The big question is whether they will make the big moves necessary to make them profitable (deep six Saturn and move that lineup to Pontiac; close more plants; layoff more workers, etc).
#147 of 486 Re: Actually Ford... [dtownfb]
by steve_ HOST
Jul 02, 2008 (10:28 am)
No one can figure out Kerkorian. He's 90 - does he want to go out owning a car company or what? (he was an officer at Studebaker 50 years ago).
If he's not careful he'll wind up owning Ford and taking it private. Then what? Let Renault/Nissan buy both it and Chrysler?
He did make a pile when he made his run at Iacocca's Chrysler.
#148 of 486 Re: Actually Ford... [steve_]
Jul 02, 2008 (11:00 am)
It wouldn't be a bad idea. Cerrebus did it with Chrysler. And Ford has much more going for it then Chrysler ever did. Kerkorian (his company) could raise the capital Ford needs to turn this boat around. Of course the UAW should be very afraid.
#149 of 486 Re: Actually Ford... [dtownfb]
Jul 02, 2008 (11:19 am)
If Kerkorian bought Ford, could he get rid of the UAW? The UAW is still at Chrysler despite being bought by Cerberus.
Heck, I would like to own GM if I had Kerkorian's money!
#150 of 486 Re: Actually Ford... [lemko]
by steve_ HOST
Jul 02, 2008 (11:25 am)
Well, my mom is 86 and she's still sharp as a tack, so maybe Kerkorian has a trick up his sleeve yet. Beats sitting around watching TV I guess. But geeze, he's down 33% on the shares he's picked up in the last few months.
#151 of 486 Re: Actually Ford... [dtownfb]
Jul 02, 2008 (1:02 pm)
If Ford is still selling Foci at a loss and only breaking even on Fusion and Taurus, then they have as good as had it. They have nothing that will boost sales in the car realm coming to the market in less than 24 months.
#152 of 486 Re: Actually Ford... [nippononly]
Jul 02, 2008 (5:24 pm)
How in the world Ford cannot make profit on Focus? It is not possible. Ford did not change Focus for 10 years, not a dime spent on development/prodcution. Wasn't making profit a point of not bringing Euro Focus to USA? They should make a tons of $$ of Focus.
#153 of 486 Re: Actually Ford... [savetheland]
Jul 02, 2008 (8:39 pm)
Yeah, that's what I would have thought too, but apparently not according to the post I was responding to.
#154 of 486 Re: Actually Ford... [savetheland]
Jul 03, 2008 (10:08 am)
My comment about the Escort and Focus was based on the late 1990s, not today. But my guess is the Focus does not make Ford a lot of money. There were always incentives on this vehicles. they did this to move the vehicles but also to maintain CAFE standards. When you sell 900,000 pickup trucks a year at a huge margin, you can afford to only break even with your cars. The current generation is different but small cars don't make a ton of money which is why their markup is generally small.
My biggest pet peeve with the domestics is they spent so much time and money on the pickups and SUVs in the 90's and gave us humdrum cars while the better cars were over in Europe. And they wonder how Toyota, Honda, Nissan etc. caught up and why people prefer their cars. You make your decisions and now you have to live with it.