Ford Market News

[Jamaican Bulldog]

Hackett wished he could have met with more dealers? Duh, maybe if he did he would learn a little something how the car business works and how to sell more cars, and how they have wasted millions on warranty claims because they kept the stupid troublesome double clutch transmission in the Focus for too long, while losing many first time customers to other brands. If a company can sell 200k Fusions and complain about the profit of it, that reflects poorly on  management not the car. Especially being one of the few in the segment that is available with AWD.

These idiots are more concerned about reactions form Wall Street than from loyal customers. The haven't figured out that if  make more customers happy then your stocks become more desirable. 

They are sabotaging sales of the Fusion in the NE lease market were about 80% are leased. We can hardly get AWD models which is one the best selling versions and customers are going else where. Then we were just informed that we can't get any regular Fusions scheduled for Aug so we should order hybrids and btw Ford is diverting leasing incentives away from non-hybrids to hybrids which are the slowest sellers. More un happy customers coming out of leases will leave because the hybrid is not available in a AWD and the hybrid models has a smaller trunk space due to the battery, plus the diversion of leasing incentives will make leasing the regular versions alot more expensive. Meanwhile they actually did something wise for the 2019 Fusion. They simplified the number of configurations and made more items standard.

[Maxidyne]

And from the trends I've noticed in pricing, those "high profit" SUVs like the Ecosport and Escape are getting their prices cut below $20k with incentives. Maybe if Ford cut back the incentives on SUVs they'd sell some more cars...

[Dirtymilkman]

7 hours ago, Maxidyne said:

And from the trends I've noticed in pricing, those "high profit" SUVs like the Ecosport and Escape are getting their prices cut below $20k with incentives. Maybe if Ford cut back the incentives on SUVs they'd sell some more cars...

They'd just lose sales to other brands. 

[Maxidyne]

Sadly true- Ford isn't the only manufacturer dumb enough to spend a few hundred million $$$ to tool up SUVs thinking they'd be profitable then getting into price wars that make them no more profitable than the sedans they want to dump.

[Jamaican Bulldog]

13 hours ago, Dirtymilkman said:

They'd just lose sales to other brands. 

Happening already.

 

20 hours ago, Maxidyne said:

And from the trends I've noticed in pricing, those "high profit" SUVs like the Ecosport and Escape are getting their prices cut below $20k with incentives. Maybe if Ford cut back the incentives on SUVs they'd sell some more cars...

That is so true. Also for the Ecosport and Escape to be under $20k with incentives it would normally be basic models of each the problems with high incentives is that it affects residual values which in turn affects lease payments. Most Japanese companies like Subaru try to keep incentives low and transaction prices close to MSRP to help keep up the residual values. With a higher residual value there is less need for rebates to remain competitive in leasing.

Sometimes people complain about resale values of some American cars, but they forget how much they saved off MSRP when they bought it new.

[Maxidyne]

Then again, for folks like us that run our cars into the ground, resale value ain't important. I scooped up one of the new "stopped sale" VW TDIs for under $20k last year, It may very well outlive me.

[Maxidyne]

23 hours ago, Jamaican Bulldog said:

et were about 80% are leased. We can hardly get AWD models which is one the best selling versions and customers are going else where. Then we were just informed that we can't get any regular Fusions scheduled for Aug so we should order hybrids and btw Ford is diverting leasing incentives away from non-hybrids to hybrids which are the slowest sellers. More un happy customers coming out of leases will leave because the hybrid is not available in a AWD and the hybrid models has a smaller trunk space due to the battery, plus the diversion of leasing incentives will make leasing the regular versions alot more expensive. Meanwhile they actually did something wise for the 2019 Fusion. They simplified the number of configurations and made more items standard.

Minnesota is similar, over half the new vehicles sold here are AWD. do you think customers are buying SUVs primarily to get AWD and would prefer a sedan if they could get AWD?

[Jamaican Bulldog]

1 hour ago, Maxidyne said:

Minnesota is similar, over half the new vehicles sold here are AWD. do you think customers are buying SUVs primarily to get AWD and would prefer a sedan if they could get AWD?

Yes I think more people are buying SUVs because of the AWD option in the snow region but also for functionality, ease of entry and egress ( especially older people) and also because they are more efficient that they used to be. However many people still prefer sedans like me and they are generally less expensive. We also sell Subaru's and their sedans do primarily well in the snow region because of the AWD. Sedans to many people are more stylish and sporty than SUVs

[Dirtymilkman]

I bought a Buick lacrosse AWD. Wife didn't want a Buick at first because of the "grandma car" stigma. Now, we love it. What a great, refined and comfortable car. The only thing I don't like is the 3.6 likes to rev high. 

[kscarbel2]

.

 

[kscarbel2]

Ford hits carbon emissions target 8 years early

Michael Martinez, Automotive News  /  June 27, 2018

DETROIT -- Ford Motor Co. says it has met a self-imposed goal of slashing manufacturing-related emissions eight years ahead of schedule.

The company in 2010 pledged to cut carbon dioxide emissions from its carmaking processes by 30 percent within 15 years. Thanks to a number of energy-conservation initiatives, it achieved its goal in half the time.

Ford announced the achievement as part of its 2017-18 Sustainability Report, saying it reduced global manufacturing CO2 emissions by more than 3.4 million metric tons from 2010 to 2017. That's equivalent to greenhouse-gas emissions from more than 728,000 passenger vehicles driven for one year, it said.

"We thought that was aggressive and we didn't really know how we were going to achieve it," Andy Hobbs, global director of Ford's environmental quality office, told Automotive News. "It was an aspirational goal."

The automaker hit its target by installing more than 100,000 LED light fixtures and adding solar panels to a number of plants across the globe, including its Dearborn Truck Plant and Michigan Assembly Plant near Detroit. It also updated its painting techniques, eliminating drying ovens to reduce energy.

Another way it reduced its carbon footprint involved a process in which a machining tool is lubricated with a finely atomized mist instead of a larger quantity of coolant and water.

"The beauty of Ford manufacturing folks is, once they accept a task, they throw everything, including the kitchen sink, to achieve it," Hobbs said.

The company is working on what its next goal will be and will announce it this year, Hobbs said, noting that it will involve additional CO2 reductions as well as adding more renewable energy practices.

Already, Ford makes around 300 parts from renewable materials. It uses eight sustainable materials in production vehicles: soy, wheat, rice, castor, kenaf (hibiscus), tree cellulose, jute and coconut.

Hobbs said the automaker would stick with the guidelines offered by the Paris climate accord to reduce vehicle emissions, even though the U.S. has formally backed out of the deal. He said Ford's goals were unchanged by the Trump administration's decision.

"As a company, at the highest levels, we've been very clear that we think climate change is real," he said. "We support the notion of fuel efficiency for our vehicles, and CO2 reduction for our manufacturing facilities."

[kscarbel2]

Ford helping dealers recruit body-shop technicians

Michael Martinez, Automotive News  /  June 30, 2018

DETROIT — Ford Motor Co. is working to combat a nationwide shortage of body-shop technicians through a new initiative in collaboration with its dealerships.

The automaker said retirements by baby boomers, while young people aren't taught the advantages of a career in skilled trades, have led to a problem properly staffing its dealers' service bays.

Ford cited estimates that the auto industry will need to hire 45,000 technicians a year through 2026. That can directly affect the quality of repair work.

"It speaks to our ability to service customers," Frederiek Toney, president of the global Ford Customer Service Division, told Automotive News. "A dealer's ability to fix it right the first time and get customers in and out in a timely manner is largely dependent on their capacity to do it."

A poor customer experience could prove costly to an automaker: The Inter-Industry Conference on Auto Collision Repair estimates that, of owners who had a bad experience with a collision repair, two-thirds get rid of their vehicle within a year and 60 percent change vehicle brands.

Ford is hoping to avoid those negative experiences by engaging students through what Toney calls a series of coordinated grass-roots recruiting efforts to add about 5,000 technicians across its network within two years. Ford dealerships currently have about 30,000 technicians to fill 65,000 service bays across the country.

The automaker plans to add "placement specialists" at dealerships to engage with high schools, junior colleges and military bases to connect with students and teach them about vocational careers. Each dealership will be mapped to a particular school, and it will be responsible for sponsoring students by providing tuition and offering summer internships. And Ford plans to donate thousands of current model-year vehicles, as well as engines and powertrain equipment, for students to work on.

"What we want to do inside Ford is to institutionalize these things if we're going to have a sustainable program to be the bedrock of our ability to provide great customer service for our customers," Toney said.

Toney said Ford already has a number of initiatives in place, but it's now bringing them all together.

"If you talk to every dealer, he or she is doing something; getting them engaged is not the problem," Toney said. "We have all these disparate activities that don't tie together in a way that allow us to be efficient and get results. We're now streamlining those efforts into one national program."

Without the still-unnamed program fully in place, Toney says Ford has recruited about 800 to 900 technicians so far this year and hopes to bump that number to 2,500 by the end of the year.

Today, about 40 percent of the students Ford sponsors go to work for its dealerships upon graduation. Ford is hoping to improve that number.

"We're helping them recruit more effectively," Toney said. "It's not just attracting them; we need to retain them."

Toney said Ford was spending "an awful lot" on the endeavor but declined to give specifics.

"Dealers have been asking for this sort of support for a long time," he said.

"The technician is the heart and soul of enabling a great experience for customers."

[Red Horse]

22 hours ago, kscarbel2 said:

Ford helping dealers recruit body-shop technicians

Michael Martinez, Automotive News  /  June 30, 2018

DETROIT — Ford Motor Co. is working to combat a nationwide shortage of body-shop technicians through a new initiative in collaboration with its dealerships.

The automaker said retirements by baby boomers, while young people aren't taught the advantages of a career in skilled trades, have led to a problem properly staffing its dealers' service bays.

Ford cited estimates that the auto industry will need to hire 45,000 technicians a year through 2026. That can directly affect the quality of repair work.

"It speaks to our ability to service customers," Frederiek Toney, president of the global Ford Customer Service Division, told Automotive News. "A dealer's ability to fix it right the first time and get customers in and out in a timely manner is largely dependent on their capacity to do it."

A poor customer experience could prove costly to an automaker: The Inter-Industry Conference on Auto Collision Repair estimates that, of owners who had a bad experience with a collision repair, two-thirds get rid of their vehicle within a year and 60 percent change vehicle brands.

Ford is hoping to avoid those negative experiences by engaging students through what Toney calls a series of coordinated grass-roots recruiting efforts to add about 5,000 technicians across its network within two years. Ford dealerships currently have about 30,000 technicians to fill 65,000 service bays across the country.

The automaker plans to add "placement specialists" at dealerships to engage with high schools, junior colleges and military bases to connect with students and teach them about vocational careers. Each dealership will be mapped to a particular school, and it will be responsible for sponsoring students by providing tuition and offering summer internships. And Ford plans to donate thousands of current model-year vehicles, as well as engines and powertrain equipment, for students to work on.

"What we want to do inside Ford is to institutionalize these things if we're going to have a sustainable program to be the bedrock of our ability to provide great customer service for our customers," Toney said.

Toney said Ford already has a number of initiatives in place, but it's now bringing them all together.

"If you talk to every dealer, he or she is doing something; getting them engaged is not the problem," Toney said. "We have all these disparate activities that don't tie together in a way that allow us to be efficient and get results. We're now streamlining those efforts into one national program."

Without the still-unnamed program fully in place, Toney says Ford has recruited about 800 to 900 technicians so far this year and hopes to bump that number to 2,500 by the end of the year.

Today, about 40 percent of the students Ford sponsors go to work for its dealerships upon graduation. Ford is hoping to improve that number.

"We're helping them recruit more effectively," Toney said. "It's not just attracting them; we need to retain them."

Toney said Ford was spending "an awful lot" on the endeavor but declined to give specifics.

"Dealers have been asking for this sort of support for a long time," he said.

"The technician is the heart and soul of enabling a great experience for customers."

 I would hope if Ford is contributing to the cost of this training the number would be a lot higher than 40%.  What is really sad IMO is when a couple of these political hacks (in particular Bernie) make a lot of noise about every kid's  ..."right to a college education" but they never talk about an education in a meaningful occupation where there is a real need.

[Maxidyne]

As for Ford, they and local dealers have been sponsoring tech students for decades, same for GM, they're merely adding body techs to the program. As for national policy, I've done the numbers and my home state of Minnesota could easily afford to give folks their first two years of post secondary education for free, as the Pell Grants pretty much cover tuition. It's the 3rd, 4th, and grad school part of post secondary education that gets expensive. BTW, seniors can attend public colleges for free in Minnesota, and they don't seem to be abusing the priviledge.

[kscarbel2]

For Ford, Fusion was right car at wrong time

Michael Martinez, Automotive News  /  July 1, 2018

DETROIT — Not since 1996 has the top-selling car in America come from a domestic brand. In 2012, it finally looked like Ford Motor Co. had an answer to the Japanese automakers' dominance of the segment.

Knowing it had a potential hit on its hands, Ford marked the arrival of its second-generation Fusion with an elaborate celebration in New York's Times Square and "American Idol" host Ryan Seacrest.

Ford touted the hybrid version's 47 mpg rating, but would-be customers were most impressed with the Fusion's handsome, aggressive styling, a bold departure from the traditional view of the enormous midsize sedan segment as bland family-haulers.

"When that car came out, it looked like an Aston Martin," recalled Jim Seavitt, owner of Village Ford in Dearborn, Mich.

Only six years later, the Fusion is headed for the scrap heap — at least in its current form. Ford announced in April it would discontinue all sedans in North America as its lineup evolves to virtually all crossovers, SUVs, pickups and vans.

The Fusion's impending demise comes as a white flag from Ford in a segment Detroit had long been desperate to reconquer. But it's also a proclamation that winning the midsize segment no longer matters nearly as much as the profits pouring in from its pickup and utility vehicles.

U.S. Fusion sales topped 300,000 in both 2014 and 2015, territory that domestic cars hadn't touched for many years. But it never managed to loosen the iron grip Toyota, Honda and Nissan had atop the segment. Coupled with the buyers' shift to crossovers and SUVs, Ford decided the Fusion wasn't worth saving, despite the brand equity it had built up over more than a decade.

"As good of a product as Fusion has been for us, that C-D segment has declined dramatically, in breathtaking fashion, and it's accelerated over the past couple years," Mark LaNeve, Ford's vice president of U.S. marketing, sales and service, told Automotive News.

Sales of the Fusion peaked at 306,860 in 2014, according to the Automotive News Data Center. They've fallen every year since, to 209,623 in 2017.

That still hasn't stopped dealers from imploring Ford management to keep the Fusion name, an idea the company seems open to, potentially as a crossover-styled vehicle after 2021. While Ford has given end-of-production dates for its Taurus and Fiesta, it has been mum on the Fusion, and just this month introduced a new Fusion police hybrid vehicle.

"We're going to have products that are new silhouettes that blur the lines between what you think of as a sedan today and a crossover today," LaNeve said. "We don't have any plans today, but could Fusion re-enter the market? It's certainly a possibility."

'Brought sexy back'

The Fusion debuted in 2005 as a replacement for the venerable Taurus, which was discontinued in 2006 after degenerating into an unloved rental-lot staple (although Ford CEO Alan Mulally resurrected the Taurus name a year later for the company's full-size sedan). The midsize Fusion was meant to anchor the automaker's new lineup of fuel-efficient family sedans.

Its popularity grew when Ford began racing Fusions in NASCAR in 2006, and sales surpassed the 200,000 mark in 2010, an important bright spot as Ford was recovering from the dark days of the recession.

The second generation of the Mexico-built car was so popular, Ford expanded production to Michigan in 2013. The MSNBC show "Morning Joe" broadcast live from the Flat Rock Assembly Plant in suburban Detroit the morning Ford started Fusion production there, highlighting the U.S. jobs that the Fusion's success had created.

While it never quite overtook the Toyota Camry, Honda Accord or Nissan Altima, the Fusion competed well, making solid inroads in coastal cities such as New York, Miami and Los Angeles. A 2015 Ford news release declared that the Fusion had "brought sexy back" to the midsize segment.

Just two years ago, the Fusion was Ford's centerpiece at the Detroit auto show display, when it brought back Seacrest to tout the car's midcycle freshening.

"It had a lot of positives," said industry analyst Dave Sullivan. "The styling of it turned heads when it came out, and it was one of Ford's truly big global sedans. It just didn't exactly prove to be what American buyers wanted."

The Fusion's decline was hardly its own fault.

As gasoline prices fell, demand for utilities and pickups surged. That was a welcome development for Ford, which makes most of its profits from those larger vehicles, but the business case for a third-generation Fusion became much tougher to justify.

Ford ended U.S. production of the Fusion in 2016, after it became clear the lower-cost factory in Hermosillo, Mexico, could make more than enough to meet demand.

Suppliers were informed late last year that plans for a 2021 redesign had been canceled.

Ford wouldn't confirm the news for four more months, but CEO Jim Hackett in December gave hints as to why Ford was comfortable letting go.

Vehicles such as the Fusion had for years been an alternative to gas-guzzling SUVs. But now, thanks to powertrain advancements, automakers are "starting to crack that code" and close the fuel economy gap, he said.

"The reasons for the balance in history had more to do with fuel than customer preference," Hackett said. "And so, if you can get rid of the difference there because of fuel, you start to relieve the pressure of what kind of portfolio you have to have."

Even in recent years, the Fusion has stood out from the competition. It finished 2017 still behind Japan's midsize trio but beat out the Chevrolet Malibu by nearly 25,000 units.

If dealers' wishes come true and the nameplate sticks around in some fashion, Sullivan suggested it could likely be similar to a Buick Regal TourX wagon.

"That's your new family sedan," Sullivan said. "It's just not what we've traditionally known."

.

[kscarbel2]

Ford's LCV leader details strategy to build on strong sales start

Nick Gibbs, Automotive News Europe  /  July 17, 2018

Ford claims brand leadership over PSA Group in Europe's van segment because of the popularity of its four-vehicle Transit model range, which includes everything from the Fiesta-size Transit Courier to the 2-ton Transit.

Ford also leads the growing 1-ton pickup segment with its Ranger.

Last year, just over a quarter of the brand's 1.36 million sales in the region were light commercial vehicles, a rise of 7.2 percent from 2016.

The division is led by Dutchman Hans Schep, who was promoted to the position in 2016 after heading Ford’s marketing team in Europe. He spoke with Automotive News Europe Correspondent Nick Gibbs.

Ford has had a strong start to the year for its sales of LCVs. Where are you getting the new customers?

We've been very successful in some markets for a long time -- for example, in the UK. [Last year, a third of Ford's European LCV sales took place there.] But now we're No. 1 in seven markets in Europe, so we're not just dependent on the few markets.

What is driving sales of vans?

Moving goods is clearly an area of growth. There's an opportunity with [the rise of] internet ordering.

How important are vans to Ford's bottom line?

It's a significant part of profit contribution for us. Extending our leadership is an important part of our European plan.

Are margins higher than cars?

They're healthy.

Does Ford have enough capacity in Spain, where you make the Transit Courier and Connect, and Turkey, where you build the Transit Custom and Transit, to reach your goals?

We announced a capacity expansion in Turkey. Twice last year, we increased our capacity; and by the middle of this year, we will be at full capacity again in Turkey. That’s enough for our growth plans, but that's being constantly evaluated.

You are not the only automaker pushing van growth. How do you stay ahead?

A continued breadth of offering is key. In the next 18 months, we will be relaunching all our commercial-vehicle products; and we will have the freshest lineup, which is critical. We're working very hard to be leading on fuel economy and resale value — key drivers of cost of ownership.

What technologies can you lean on to improve fuel economy?

We recently introduced our brand new Panther diesel engine (EcoBlue), and that's a leading engine on fuel economy.

You've got a plug-in hybrid Transit coming next year, and you have a tie-up with DHL's electric-vehicle vanmaker, StreetScooter. What are your electrification targets?

There's a lot more than putting a battery in. It's linked to use case. For instance, if the battery results in less payload, requiring customers to change business models, then that's not the right solution. We are currently piloting the plug-in hybrid together with our customers and teaming up with DHL on StreetScooter to really understand how the last-mile delivery customers use their vehicles. We're convinced our world will look very different in a few years.

What's next with StreetScooter?

StreetScooter put its powertrain into our big Transit, and we're working together with them to optimize the product for their specific use case. We plan to build 2,800 vehicles this year, making it one of the largest EV van producers in Europe in 2018.

What is the engineering overlap with cars in terms of van platforms?

The two bigger vans share a dedicated van platform, but we share technologies — for example, the driver assistance features we are introducing. The smaller vans — the Courier and Connect — are shared with subcompact and compact cars, respectively.

How little do the vans change when sold outside Europe?

We have the global engineering facility for the Transit range in the UK, so that's the first scale opportunity. The big Transit is also manufactured in the U.S., and the 1-ton Custom is also sold in Asia. They are different by region, but they use the same platform everywhere in the world.

So, the van is a true global product?

The use cases are pretty similar around the world. Of course, there are differences. But everywhere you need to move stuff around, which allows us to look at global solutions.

What is driving the growth of pickups in Europe?

The growth is very much in the retail space. I guess customers are still looking for expressive vehicles, and pickups are really an exponent of that.

What are the new trends with the delivery-van market?

Within the next 18 months, we will be putting modems into our commercial vehicles, so 100 percent will be connected. Then we will be able offer our customers much more than products on wheels but solutions to improve their own businesses. We see significant opportunity there. We will be talking more about that this year.

.

[kscarbel2]

Ford commits $4 billion to autonomous vehicles, forms new subsidiary

Michael Martinez, Automotive News  /  July 24, 2018

DETROIT -- Ford Motor Co. on Tuesday said its investments in autonomous-vehicle development are expected to total $4 billion through 2023 and that it has formed a subsidiary devoted to those efforts called Ford Autonomous Vehicles LLC.

The subsidiary will be be based primarily at the campus Ford is creating in Detroit's Corktown neighborhood and led by Sherif Marakby, a Ford vice president who spent a year heading Uber's autonomous-vehicle program before rejoining Ford in 2017. It will have its own board of directors chaired by Marcy Klevorn, Ford's president of mobility.

The new LLC will be the entity charged with fulfilling Ford's promise to launch a self-driving commercial vehicle at scale in 2021. It includes the automaker's self-driving systems integration, autonomous vehicle research and advanced engineering, AV transportation-as-a-service network development, user experience, business strategy and business development teams.

"Ford has made tremendous progress across the self driving value chain — from technology development to business model innovation to user experience," Ford CEO Jim Hackett said in a statement. "Now is the right time to consolidate our autonomous driving platform into one team to best position the business for the opportunities ahead."

Ford shares rose after the announcement, gaining 2.2 percent to $10.70 in midday trading.

The $4 billion in AV spending includes $1 billion that Ford has committed to investing in Argo AI, a Pittsburgh startup that has become its partner in self-driving system development.

Ford Autonomous Vehicles LLC will hold the ownership stake in Argo AI that Ford received in exchange.

Third-party investment

The subsidiary is set up to take on other third-party investment and will be separate from Ford's Smart Mobility LLC, which handles new business opportunities such as its Chariot shuttles.

Marakby, currently Ford's vice president for autonomous vehicles and electrification, has been given the title of CEO for the autonomous-vehicle unit.

The automaker made several other organizational changes effective Aug. 1 as a result. Ted Cannis, Ford's global director for electrification, will lead Ford's electric-vehicle arm, known as Team Edison. Additionally, Ford said it is reorganizing its global operations division, headed by Joe Hinrichs, to include information technology as well as the company's global order-to-delivery system.

Ford's chief information officer, Jeff Lemmer, will report to Hinrichs. And Hau Thai-Tang, Ford's executive vice president for product development and purchasing, will report directly to Hackett instead of Hinrichs.

"The evolution of computing power and IT have helped bring great products to customers — from cars to tablets," Hackett said. "We can now harness this technology to unlock a new world of vehicle personalization, supply chain choreography and inventory leanness that rivals any industrial model in the world — and Joe's challenge is to help us redesign this system to do just that — while better serving customers and dealers and improving our overall fitness."

The announcement follows Ford's recent purchase of Detroit's vacant Michigan Central Station, a century-old office tower it plans to convert into the hub of an urban campus dedicated to work on autonomous and electric vehicles. Ford opened an office near the depot earlier this year for about 200 employees that are part of Team Edison.

.

[Dirtymilkman]

Is it me, or is Ford just treading water and content where it's at? It seems their only interest is the pick-up and real estate. And what's with the new subsidiaries? A business cannot be afraid of failure. 

[Maxidyne]

Interesting to see the world's automakers spending billions and stumbling all over themselves to develop electrification and automated driving technologies that customers have shown little desire for. The $4,000,000,000 they're wasting on these fads would have funded a whole new conventional cab medium/heavy truck program and a world class small transverse engine car/crossover/van program.

[kscarbel2]

Ford lowers 2018 profit forecast as Q2 net falls 48%

Michael Martinez, Automotive News  /  July 25, 2018

DETROIT -- Ford Motor Co. lowered its full-year forecast due to challenges overseas and said CEO Jim Hackett's global restructuring efforts could result in charges totaling $11 billion over the next three to five years.

CFO Bob Shanks said the weaker guidance was not related to the Trump administration's tariffs on steel and aluminum, which General Motors cited earlier in the day when cutting its own outlook. Ford did, however, take a tariff hit in the quarter and expects a bigger impact later this year.

Ford said trouble in Europe and Asia will trim adjusted earnings to $1.30-$1.50 a share in 2018, from prior guidance of $1.45-$1.70 per share. In a statement, the company said it expects a loss in Europe due to higher costs, and a “significant loss” in Asia due to lower pricing and an unfavorable mix in China.

In the second quarter, Ford's net income fell 48 percent to $1.1 billion. Executives blamed the drop on challenges in China and a supplier fire that crippled U.S. production of highly profitable F-series pickups for more than a week in May.

Revenue fell 2 percent to $38.9 billion compared with the second quarter of 2017. Ford's earnings before interest and taxes dropped 40 percent to $1.7 billion.

"It was obviously a very tough quarter for us," Shanks told reporters.

Ford's North American profit dropped 25 percent to $1.8 billion. It attributed the decline to a fire at a Michigan magnesium plant that made parts for the F series and a settlement over faulty Takata airbags. Ford's earnings fell in each of its global regions other than the one that comprises Africa and the Middle East.

Shanks said Ford took a $145 million hit in the quarter related to tariffs and expects that Ford will lose $500 million-$600 million on tariff-related charges this year. But he said the issue was not affecting earnings guidance because the company will be able to absorb the costs in North America.

Ford shares sank earlier Wednesday to their lowest level in nearly six years before its earnings were reported, but recovered most of their losses and closed the day off less than 1 percent at $10.52. In after hours trading, the shares fell 2.4 percent as of 4:31 pm ET. 

Restructuring charges

Shanks declined to say if the $11 billion in restructuring charges would result in Ford pulling out of any global markets but suggested that, by offering a concrete number, Ford already had a sense of what exactly it planned to do. A Morgan Stanley analyst report in March estimated that Ford would need to take charges of $4 billion to $12 billion to achieve the kind of cost cuts Hackett is targeting.

Ford said it has postponed its upcoming investor day, scheduled for Sept. 26, and will set a new date “when more specifics can be shared on global redesign and restructuring.”

Ford’s profit margin for the quarter was 2.7 percent, down from 5.1 percent a year earlier. Its North American margin declined to 7.4 percent from 9.5 percent in the second quarter of 2017.

The company lost $394 million in its Asia Pacific region, versus a $167 million profit a year earlier. Its European region swung to a loss of $73 million, and South American losses grew 1 percent to $178 million. It made $49 million in the Middle East & Africa after losing the same amount a year earlier.

Ford said its mobility unit lost $181 million in the second quarter, nearly triple its outflow a year ago. The unit is in a stage with heavy investment and little revenue to offset that.

Ford Motor Credit made $645 million, a 4.2 percent increase.

Ford’s net income equaled 27 cents per share, 4 cents less than the consensus estimate on Wall Street of 31 cents.

[Red Horse]

Well I have to say I agree with Maxidyne's comment on "electrification".  Then again maybe we should make a distinction between "electrification" and "autonomous" vehicles.  No doubt there will be a battle between electrified vs IC vehicles-assuming the cost of electricity is accurately captured, but its the self driving cars that makes me scratch my head.

I thought Americans loved their vehicles?..Loved  to drive?  Apparently Silicon Valley has convinced people at the top that we are done with all that.

Then again, considering most new drivers don't know what a 3 pedal vehicle is, and probably can't change a tire. perhaps Silicon Valley knows what's best for us.

Thank God we have furniture man at the helm😎

[kscarbel2]

Ford seeks European profitability with shift to crossovers, vans

Nick Gibbs, Automotive News  /  July 27, 2018

Ford is redirecting spending in Europe away from cars to focus on more profitable crossovers and commercial vans to help return its operations in the region to profit.

Hit by Brexit and a big consumer switch to crossovers, Ford’s European operations swung to a $73 million pretax loss in the second half from an $88 million profit last year.

Announcing the results on Wednesday, CEO Jim Hackett said: “We're extremely dissatisfied with our performance in Europe.”

Ford now expects a full-year loss in Europe after earning $234 million in the region last year.

CFO Bob Shanks said the bulk of Ford’s European vehicle range was unprofitable. “The low-performing part of our portfolio represents a majority of our volume, revenue and capital deployed in the region,” he said. This consisted “principally of cars and multi-activity vehicles [minivans] such as C-Max,” he said.

Ford’s Transit van, Kuga crossover and Ranger pickup and “selected imports” are selling profitably in Europe, Shanks said, without naming the imported vehicles. They are likely to include the Edge midsize crossover and the Mustang sports car.

Shanks said the vehicles represented more than 200 percent of Ford’s profits in Europe, despite accounting for less than half of its volume and revenue.

Europe needs reboot

Jim Farley, Ford’s head of global markets, said commercial vans are earning 13 percent profit margins for the automaker in Europe.

Ford is shifting its focus to concentrate on vans and crossovers to hit its long-term target of a 6 percent margin in the region, Farley said.

“Clearly we have to redesign Europe, centering the operations on our profitable LCV business,” he said. SUVs were also part of that plan. Capital allocation plans now align with the SUV and the LCV business opportunities, Farley said.

Ford is making the right move, said Ian Fletcher, principal analyst at IHS Markit. “Ford cannot afford to just tinker. They have undertaken restructuring in the past and they’re still moaning about the lack of profitability in the region. They have to take a big step or they will be in the same situation down the line.”

Ford has attempted to boost margins on its Focus compact and Fiesta subcompact cars by offering different variants designed to increase its selling price, including an Active crossover-inspired version and an upscale Vignale-badged model.

The tactic isn’t paying off. “New products are delivering incremental profit but lower than planned,” Ford indicated in its second-quarter regulatory filing.

Margins were being “compressed” by a “weaker channel mix, lower net pricing and exchange headwinds,” the company said.

Brexit hit

Ford has been hit by exchange headwinds mainly from the UK, its largest market in Europe, after the British pound lost value following the country’s decision to leave the EU.

The pound’s fall explains the “majority of our deterioration” in profit in Europe, Farley said. “In 2016 we made $1.2 billion in Europe and most of it was in the UK. Brexit and the continued weak sterling has been a fundamental headwind for our European business,” Farley said.

He acknowledged that Ford has been slow to expand in the crossover segment in Europe.

“One of our underlying issues is that we are behind on the shift to utilities and now our portfolio under-indexes on this highly profitable and growing segment,” he said on Wednesday’s earnings call.

Ford currently sells three crossovers in Europe: the small EcoSport, compact Kuga and midsize Edge. Kuga and EcoSport sales in Europe reached a record in the second quarter, Ford said.

Ford described its Kuga as “aging” in its filing and said new launches will increase its product mix by 2020, indicating new models are coming soon.

A Fiesta-based replacement for the EcoSport is due in 2020, analyst firm LMC Automotive predicts.

Products under threat

Ford singled out the C-Max compact minivan on its investor call as under-performing in Europe, indicating it could stop production of the car in the region.

Sales of the C-Max slid 18 percent in the first half to 31,888, figures from JATO Dynamics show. Also under threat is the Mondeo midsize car, which is a version of the U.S. Ford Fusion. Ford has said it would phase out U.S. sedan sales, including the Fusion, by 2020. The related S-Max and Galaxy large minivans could also be dropped.

Alongside redirecting r&d spending away from cars and toward vans and SUVs, Ford said it also planned to continue to “aggressively” cut costs and get new products to market quicker in Europe.

The company said in June it would close its Blanquefort gearbox plant in Bordeaux, southwest France, if no buyer was found.

Partnering up

On Wednesday’s call CEO Shanks said Ford also will rely more heavily on partnerships to turn Europe around. “It's important to recognize that partnerships, which are a part of our fitness toolkit, are already an integral part of our European operations and going forward we expect them to play an even greater role,” Shanks said.

Ford has a long-term partnership with PSA Group on engines.

In June it signed an agreement with Volkswagen Group for a potential an alliance on commercial vehicles, as well as other, non-specified projects.

.

[Maxidyne]

The Ford family really needs to quit letting the newbie interns run the company...

[kscarbel2]

Ford adds formerly Raptor-exclusive engine to 2019 F-150 Limited

Michael Martinez, Automotive News  /  July 27, 2018

DETROIT -- The most expensive version of the F-150 pickup is adding a Raptor roar in Ford's latest thrust in Detroit's hypercompetitive truck sector.

Ford Motor Co. said this week it will offer a high-output 3.5-liter EcoBoost engine -- which has been available only on the F-150 Raptor performance pickup -- on its 2019 F-150 Limited trim. The engine is the most powerful in the F-150's lineup, producing 450 hp and 510 pound-feet of torque. It will be paired with the automaker's 10-speed transmission.

Ford did not disclose pricing, but the 2018 Limited trim starts at more than $60,000.

The 2019 model will include a suede headliner, leather-topped instrument and door panels, ash swirl wood trim and special graphics.

The interior also will feature leather-wrapped massaging seats, a heated steering wheel and heated-or-cooled front seats.

Technology will include standard adaptive cruise control, standard precollision assist with automatic emergency braking, active park assist and a lane-keeping system. It will come with the Sync 3 infotainment system and 4G LTE Wi-Fi, among other features.

The 2019 F-150 Limited will go on sale this year. Ford's F series is on pace to break a sales record set in 2004, although it will face increased competition the rest of the year as crosstown rivals introduce redesigned versions of the Ram 1500, Chevrolet Silverado and GMC Sierra.

In addition to the new engine coming on the Limited trim, Ford this year offered an F-150 diesel engine option for the first time.

.

[kscarbel2]

Is Ford Looking to Bring a Car-Based Pickup Truck to the U.S.?

Greg Fink, Car & Driver  /  July 28, 2018

Ford is rumored to be working on a small subcompact pickup truck that may also make its way to the North American market. The new truck is expected to serve as the informal replacement to the Ford Courier—a small pickup that was sold in countries such as Brazil and Mexico.

Whereas the previous Courier was based on old Ford Fiesta components, Automobile Magazine reported the new model will share its underpinnings with the latest global Ford Focus compact car.

Supporting the model’s North American prospects: Ford has applied to trademark the Courier name with the United States Patent and Trademark Office. The nameplate was previously applied to a Mazda-based compact pickup truck Ford sold in the United States throughout the 1970s and early 1980s. More recently, Ford has used the name on the Transit Courier small van that is sold overseas, and it’s possible that Ford’s trademark application is in reference to that vehicle.

Although Ford spokesperson Dawn McKenzie declined comment on the Courier, she said in an emailed statement that the company is “significantly expanding our North America lineup with all-new vehicles and entering new segments with fresh designs and white-space silhouettes that will position us for even more growth.”

• Beyond the Range: The Visual History of Ford’s Compact Pickups
• Everything You Need to Know About the 2019 Ford Ranger
• Put to Bed: These Are the Forgotten Pickup Trucks, Volume I

Where that leaves the sub-Ranger-sized pickup remains to be seen. Should it materialize, the Courier can expect to compete directly with the production Hyundai Santa Cruz compact pickup, which is expected to go on sale in the next few years.

.