No Easy Answers

[Blue Oval Staff]

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[Roadrunner]

The strongest argument presented is regarding why Jaguar shouldn't be sold (which is a differing opinion than my own, but I can now understand why it shouldn't be sold).

[DSenstad]

1) Partner with Honda (or Toyota, or BMW, or … )

 

Downside: This would provide no short term benefit except cash. Cash, it is generally acknowledged is not a short-term problem at Ford. This solution causes new problems while purporting to solve a problem that doesn’t exist.

 

Ford has little in the way of engines, transmissions, facilities, or platforms to interest other manufacturers. Among those that are likely to see anything worth cherry-picking from Ford.

Until now it seems that Ford has taken on wayward Childs such as Jaguar which needed our help. Richards premise seems to be built on the fact that we must continue to be the provider of relief rather than the recipient.

 

I have trouble believing that others can not provide engines or transmissions for any line they were to purchase or that the buyer could not have as part of the agreement that Ford would provide engines for the amount of time that they would require to ramp up their facilities. Doesn't Ford buy engines and transmissions from other companies?

 

2) Sell Jaguar

 

A favorite of many, the “Sell Jaguar†approach is one that has likely come up many times in house, and has been vetoed each time. Why should Ford keep Jaguar? Among other reasons, it would net a pittance, if sold. We’re talking perhaps as low as the tens of millions of dollars, if Ford only sells Castle Bromwich and the Jaguar name (no one in their right mind would buy Halewood–high quality facility and all, but its only product is the X-Type). Jaguar’s administrative staff, accounting, and U.S. dealer network is thoroughly intertwined with Land Rover’s thus linking the two brands at the hip. Furthermore, the engines for these products are built at Ford facilities.

 

This seems to be built on three premises. One, no one wants Jaguar which may or may not be true. Two, That Jaguar and Land Rover are closely tied and divesting one from the other could create a difficult situation. I see dealers who have multiple lines all the time. I see dealers who have foreign and domestic lines and even know of dealers in the out state who own and sell both the Daimler/Chrysler brands and the Ford/Lincoln/Mercury brands side by side, I don't see the difficulty. I also believe that the Land Rover entity is one which could be sold as well, perhaps in combination. Three that Jaguar only needs to close the Halewood plant and it will be profitable. I think we have been led by that carrot for quite a few years now, the time has come to look for another carrot to follow.

 

I agree with the last 3 points, in fact I hadn't heard any real talk about selling of Volvo. I will say that if you rearrange the first two points, sell Jaguar/Land Rover/Aston Martin, teaming up with BMW takes on significant new appeal. I would go as fas as to suggest that this peice was written in the format that is was to eliminate that point.

[RichardJensen]

Until now it seems that Ford has taken on wayward Childs such as Jaguar which needed our help. Richards premise seems to be built on the fact that we must continue to be the provider of relief rather than the recipient.

 

I have trouble believing that others can not provide engines or transmissions for any line they were to purchase or that the buyer could not have as part of the agreement that Ford would provide engines for the amount of time that they would require to ramp up their facilities. Doesn't Ford buy engines and transmissions from other companies?

 

This seems to be built on three premises. One, no one wants Jaguar which may or may not be true. Two, That Jaguar and Land Rover are closely tied and divesting one from the other could create a difficult situation. I see dealers who have multiple lines all the time. I see dealers who have foreign and domestic lines and even know of dealers in the out state who own and sell both the Daimler/Chrysler brands and the Ford/Lincoln/Mercury brands side by side, I don't see the difficulty. I also believe that the Land Rover entity is one which could be sold as well, perhaps in combination. Three that Jaguar only needs to close the Halewood plant and it will be profitable. I think we have been led by that carrot for quite a few years now, the time has come to look for another carrot to follow.

 

I agree with the last 3 points, in fact I hadn't heard any real talk about selling of Volvo. I will say that if you rearrange the first two points, sell Jaguar/Land Rover/Aston Martin, teaming up with BMW takes on significant new appeal. I would go as fas as to suggest that this peice was written in the format that is was to eliminate that point.

1) The more closely intertwined the division's operations are, the lower the purchase price. If you can buy car, plant, tooling, engines, and administration, you will pay a higher price than if you can only buy car, plant, and tooling. Why? Because you a) have to pay for the engines--lowering your profits going forward, because Ford is not going to sell those engines at cost, and b ) you have to integrate administration of this new division into your existing management. The issue is NOT whether it is possible to sell only bits and pieces of Jaguar, but whether it's worth it. I believe that selling Jaguar, or selling Jaguar, Land Rover, and Aston Martin does nothing except eliminate a few years of losses. BTW, by administration, I am not referring to dealerships, I'm referring to accounting, product development, testing facilities, sales management (the people that manage the dealership networks), etc. Ford has so tightly integrated all these operations for the Brit PAG units that they cannot be divested individually for any reasonable amount of money

 

To state more simply: The more Ford can sell, the higher the price. With Jaguar, Ford is very limited in how much they can sell. Ditto Volvo, ditto Land Rover.

 

2) Jaguar was profitable in the late 90s with only Castle Bromwich and Browns Lane, and only two products (the XJ and XK). The decision to build the X-Type and to dedicate an entire plant to it was what ruined the nascent rebirth of Jaguar in the late 90s. Ford is merely returning to a proven strategy. True, it locks Jaguar out of the high-growth aspects of the luxury segment (entry-level and CUV), but it does retain the inimitable Jaguar style, without which, the brand is nothing.

 

To reiterate, as I am being rather long-winded once again: The issue is not whether Ford can sell Jaguar, but whether it's worth it. Fairly priced, Jaguar alone is nearly worthless. Combined the Brit PAG units are more valuable, but also, combined, they have significant profit potential.

 

3) In order for Ford to be a reasonable target for an equity investment, they need to have something worth buying. The only things Ford has worth buying are: for Toyota, VAG, Honda, and Nissan: trucks, for PSA and/or FIAT: midsize cars and global production capacity, Chinese anything: global capacity and credibility, BMW, Porsche: NOTHING.

 

a) Trucks--is it worth allowing a competitor with a better reputation for reliability in the U.S. to build F150 clones?

 

b ) Are FIAT and PSA in a position to invest in Ford? No. PSA is rather cash strapped and has low margins, and FIAT has probably already spent the $2B they got from GM. If PSA had the cash, they are likely to be the best contender--but only because in the D & E segments in Europe, their current offerings are subpar.

 

c) The most likely 'white knight' for Ford is likely a company in China. Do you think this is a good idea?

 

There is nothing Ford has that would be worth an investment by BMW. Without an investment by BMW, any partnership is worthless. If BMW has something FORD wants, FORD has to pay for it, which is hardly a viable option at this point in time.

 

Again, the question is not whether a partnership is feasible, but what Ford's partner stands to gain.

 

BTW, thanks for interpreting far more intent to my structuring of arguments than was actually there.

 

(another point worth noting is that Bill Ford is a very ethical person, and Ford's family legacy has led to some rather long-lasting loyalties and commitments--as in Ford's long term relationships with Jack Roush, Robert Yates, the Wood Brothers, decades of industry leading philanthropic efforts, etc. Bill Ford himself likely recognizes a responsibility to Jaguar, and a responsibility for decisions that have led to Jaguar's current fiscal disarray. It is not as though Jaguar, the brand, is incapable of being profitable, it's a question of how to make it profitable. Ford had it right once in the past, and I can forgive Bill Ford for having a conscience regarding the commitments his company has made. Apart from all the business reasons for keeping PAG--including the fact that a sale of PAG generates short term cash which is not necessarily a problem at Ford, there remains a moral obligation to Jaguar's, and PAG's employees. Ford has moved more slowly than GM to close plants and buy out workers (and indeed eliminated many jobs-bank numbers through attrition), in part because Bill Ford has been unwilling to play the part of 'cold hearted businessman'. I'd like to think that eventually a turnaround in Ford's fortunes will reward him for having a conscience and listening to it.)

Edited August 5, 2006 by RichardJensen

[waymondospiff]

It is not as though Jaguar, the brand, is incapable of being profitable, it's a question of how to make it profitable.

 

I think that is the key and is missed nearly 100% of the time by "analysts." There is nothing wrong with Jaguar that new, killer products won't help. The brand image of Jaguar is still intact, something of a minor miracle. If Ford can highlight the new Jaguar's world-class quality and world-class designs (S, XJ, XK) then there is no reason Jaguar cannot make money.

 

I agree whole-heartedly with your arguments that the only thing selling assets provides is cash, and Ford doesn't need cash now. Ford needs to spend what is needed to maintain the competitive position in Europe, support the PAG brands, and, most importantly, the US market products. Issues like health care and work rules need to be addressed with the UAW and excess plants need to be closed, but would we hear a peep from the "analyst" community if the cars were selling? Probably not.

 

Scott

[DSenstad]

1) The more closely intertwined the division's operations are, the lower the purchase price. If you can buy car, plant, tooling, engines, and administration, you will pay a higher price than if you can only buy car, plant, and tooling. Why? Because you a) have to pay for the engines--lowering your profits going forward, because Ford is not going to sell those engines at cost, and b ) you have to integrate administration of this new division into your existing management. The issue is NOT whether it is possible to sell only bits and pieces of Jaguar, but whether it's worth it. I believe that selling Jaguar, or selling Jaguar, Land Rover, and Aston Martin does nothing except eliminate a few years of losses. BTW, by administration, I am not referring to dealerships, I'm referring to accounting, product development, testing facilities, sales management (the people that manage the dealership networks), etc. Ford has so tightly integrated all these operations for the Brit PAG units that they cannot be divested individually for any reasonable amount of money

 

To state more simply: The more Ford can sell, the higher the price. With Jaguar, Ford is very limited in how much they can sell. Ditto Volvo, ditto Land Rover.

 

2) Jaguar was profitable in the late 90s with only Castle Bromwich and Browns Lane, and only two products (the XJ and XK). The decision to build the X-Type and to dedicate an entire plant to it was what ruined the nascent rebirth of Jaguar in the late 90s. Ford is merely returning to a proven strategy. True, it locks Jaguar out of the high-growth aspects of the luxury segment (entry-level and CUV), but it does retain the inimitable Jaguar style, without which, the brand is nothing.

 

To reiterate, as I am being rather long-winded once again: The issue is not whether Ford can sell Jaguar, but whether it's worth it. Fairly priced, Jaguar alone is nearly worthless. Combined the Brit PAG units are more valuable, but also, combined, they have significant profit potential.

 

3) In order for Ford to be a reasonable target for an equity investment, they need to have something worth buying. The only things Ford has worth buying are: for Toyota, VAG, Honda, and Nissan: trucks, for PSA and/or FIAT: midsize cars and global production capacity, Chinese anything: global capacity and credibility, BMW, Porsche: NOTHING.

 

a) Trucks--is it worth allowing a competitor with a better reputation for reliability in the U.S. to build F150 clones?

 

b ) Are FIAT and PSA in a position to invest in Ford? No. PSA is rather cash strapped and has low margins, and FIAT has probably already spent the $2B they got from GM. If PSA had the cash, they are likely to be the best contender--but only because in the D & E segments in Europe, their current offerings are subpar.

 

c) The most likely 'white knight' for Ford is likely a company in China. Do you think this is a good idea?

 

There is nothing Ford has that would be worth an investment by BMW. Without an investment by BMW, any partnership is worthless. If BMW has something FORD wants, FORD has to pay for it, which is hardly a viable option at this point in time.

 

Again, the question is not whether a partnership is feasible, but what Ford's partner stands to gain.

 

BTW, thanks for interpreting far more intent to my structuring of arguments than was actually there.

 

(another point worth noting is that Bill Ford is a very ethical person, and Ford's family legacy has led to some rather long-lasting loyalties and commitments--as in Ford's long term relationships with Jack Roush, Robert Yates, the Wood Brothers, decades of industry leading philanthropic efforts, etc. Bill Ford himself likely recognizes a responsibility to Jaguar, and a responsibility for decisions that have led to Jaguar's current fiscal disarray. It is not as though Jaguar, the brand, is incapable of being profitable, it's a question of how to make it profitable. Ford had it right once in the past, and I can forgive Bill Ford for having a conscience regarding the commitments his company has made. Apart from all the business reasons for keeping PAG--including the fact that a sale of PAG generates short term cash which is not necessarily a problem at Ford, there remains a moral obligation to Jaguar's, and PAG's employees. Ford has moved more slowly than GM to close plants and buy out workers (and indeed eliminated many jobs-bank numbers through attrition), in part because Bill Ford has been unwilling to play the part of 'cold hearted businessman'. I'd like to think that eventually a turnaround in Ford's fortunes will reward him for having a conscience and listening to it.)

Yes that was long winded; it shows your great acumen in noting that, now if you would only address that issue.

 

I'm still having problems with your contention that a high end vehicle can not absorb an initial cost in transferring ownership. Did Ford have to create a total new network when they bought Jaguar? I don't think so, the entire "administration" came along with the product line and much will be sold with the line when it goes. Much of what might be lacking is already in place by the purchasing corporation, they will NOT have to develop new test grounds as they probably already have some. If they do not have some in the UK a testing grounds could well be included in the cost of the transaction, no one said it would be simply or painless.

 

Again you talk about this myth of profitability... I think you said "I believe that selling Jaguar, or selling Jaguar, Land Rover, and Aston Martin does nothing except eliminate a few years of losses." I have stopped looking at that carrot and have begun to look beyond. 17 years of association with Jaguar and we had how many years of profitability? What is the overall spreadsheet say, has Ford balanced the profits with the debits? I think we are to far balance in this decade, or even the next.

 

I'll concede, I'm having a difficult time find a valid reason for BMW to teem up with Ford but I'm working on it. ^_^

 

I hope Ford is rewarded for his actions now as well however I am having a more difficult time praising him for his benevolence.

 

I'd love to continue this discussion bit I have a prior engagement.

[RichardJensen]

17 years of association with Jaguar and we had how many years of profitability?

Probably 6 - 8 on the high end, as little as 4-5 on the low end. You have to pay £1 per annual report from "Companies House", the UK version of the SEC, something I'm just not prepared to do. From SEC filings, it appears that Ford booked about $2-300M worth of charges during the 90s, related to Jaguar restructuring, and Jaguar's results were rolled into Ford of Europe during that period. Given the weak state of Ford of Europe in the late 90s, it seems as likely that Jaguar results were rolled into Ford of Europe to prop up Ford brand statistics as to prop up Jaguar statistics.

[DSenstad]

Would that be Jaguar globally or Jaguar of Europe?

[RichardJensen]

Would that be Jaguar globally or Jaguar of Europe?

Global Jaguar. Jaguar Ltd. would have--substantially--the operating loss or profit for all Jaguar's global sales. This unit's results would be rolled into the results of Ford of Europe, Ltd (which no longer exists, BTW).

[Biker16]

The arrival of Mark Fields in the president’s office, and Darrel Kuzak (who led the C1 team) in the catbird seat at product development, brought about a review of Ford NA’s plans regarding the Focus. The decision to update the current Focus for 2008 model year was already made, and work had begun (in November 2005 Ford was well under way with the update to the Focus, with a launch date of mid 2007). The question was what would happen next, and when would it happen. Some were in favor of keeping the Focus on its own architecture, and continuing to update that. The most recent word is that Ford is planning on pulling ahead the launch of C2 (possibly debuting the next Focus in Frankfurt, 2007), and prioritizing a launch in the U.S. as early as 2008. C2 is being designed, from the beginning, with a view towards sale in the U.S.

 

However, once again, we are talking about a couple YEARS before new C and B cars arrive. Of course, when they arrive, Ford will have one of the broadest array of small cars available. Already its Focus range offers more configurations than any competing compact range. With the possible addition of a Mazda5 sized microvan, a coupe, and three new “B†cars (a sedan, CUV, and coupe), Ford’s small car range looks pretty good. In 2008.

 

Dream on, Ford of europe will lead the Development of C2 not Ford N.A. It makes 0 sense for Ford N.A. to lead a C-platform, it is not thier area of expertise. name the last Car ford of NA developed from scratch, the mustang.

 

C2 will be 2010CY. I believe That the 2010 will be a copy of the european Focus. why? Because looking 3-4 years out I can see a much closer parity of fuel prices N.A. vs EU. and as people down size they don't want cheap cars but cars that are cheap to own. You can see this now with the Mz3 and the new civic. With mutiple B-cars benaeth the Focus there is no reason that the massive decontneting that took place before would need to be repeated, in 2010.

 

". Already its Focus range offers more configurations than any competing compact range"

 

thats funny because they are dumping the hatches.

 

there is hope for Ford its just that my 2000 focus may not last long enough, f I switch I may never comeback.

[RichardJensen]

Dream on, Ford of europe will lead the Development of C2 not Ford N.A. It makes 0 sense for Ford N.A. to lead a C-platform, it is not thier area of expertise. name the last Car ford of NA developed from scratch, the mustang.

 

C2 will be 2010CY. I believe That the 2010 will be a copy of the european Focus. why? Because looking 3-4 years out I can see a much closer parity of fuel prices N.A. vs EU. and as people down size they don't want cheap cars but cars that are cheap to own. You can see this now with the Mz3 and the new civic. With mutiple B-cars benaeth the Focus there is no reason that the massive decontneting that took place before would need to be repeated, in 2010.

 

". Already its Focus range offers more configurations than any competing compact range"

 

thats funny because they are dumping the hatches.

 

there is hope for Ford its just that my 2000 focus may not last long enough, f I switch I may never comeback.

I don't see anything in what I wrote that said Ford NA is leading the development of the C2 Focus.

 

There's a difference between leading development and providing cost targets.

 

Finally, global oil prices are what they are, and EU taxes are what they are, and therefore, unless U.S. tax policy 'catches up' with EU tax policy, gas will still be substantially cheaper here.

 

C2 may have originally been scheduled for CY 2010, but word is that it has been pulled ahead, in order to get a more competitive Focus in the U.S. faster. It would be odd, but feasible, for Ford NA to get the C2 Focus a year ahead of Europe. Ford NA needs it more.

[silvrsvt]

there is hope for Ford its just that my 2000 focus may not last long enough, f I switch I may never comeback.

 

 

Please get over it..if Ford doesnt make what you want go buy something that does...you dont owe Ford anything and if they don't threatn not to come back..I'm sure there are 100s of other people who will. Your not accoplishing anything besides reinforcing the fact that your hung up just one type of car, much like the Panther fans we have here.

[2005Explorer]

there is hope for Ford its just that my 2000 focus may not last long enough, f I switch I may never comeback.

 

Why would you not consider a 2008 Focus? If Ford gives it new sheetmetal...a new interior...powertrain upgrades and other features it would be a huge improvement over what you currently drive.

 

The current Focus' chassis is completely competitive in it's class...the part that is not is the "going on 8 years old look to it."

Edited August 7, 2006 by 2005Explorer

[630land]

Please get over it.[biker's endless rants about the C1 and desire for $20K base Focuses] .if Ford doesnt make what you want go buy something that does...you dont owe Ford anything and if they don't threatn not to come back..I'm sure there are 100s of other people who will. Your not accoplishing anything besides reinforcing the fact that your hung up just one type of car, much like the Panther fans we have here.

 

 

I agree, and no way will there ever be "high priced Focuses" as long as Hyundai, Honda, Toyota, Nissan, sell C class cars for competitive prices. Even if gas goes up, buyers are not going to say 'well i will sure pay over sticket for this compact'. They will go else where to save $$ for gas, even keep old car!

 

And WE ALL think it is time to quit whining about "no c1!! waaaaaa" C2 will take into account US market. Its been 3 years since they said "C170 stays". Is this endless ranting because one thought we were really getting a 2004 C1, and posted all these "Cant wait" articles in Focaljet back in 2002ish??????

 

 

Some think "one car" would save Ford. "

 

"C1 with $20,000 MSRP"

"Vics with 5.4"

"AWD anything"

"Boxy Town Cars"

Edited August 7, 2006 by 630land

[Biker16]

Please get over it..if Ford doesnt make what you want go buy something that does...you dont owe Ford anything and if they don't threatn not to come back..I'm sure there are 100s of other people who will. Your not accoplishing anything besides reinforcing the fact that your hung up just one type of car, much like the Panther fans we have here.

LOL ,

 

I am hung up on small cars, I am sorry.

 

 

Why would you not consider a 2008 Focus? If Ford gives it new sheetmetal...a new interior...powertrain upgrades and other features it would be a huge improvement over what you currently drive.

 

 

true it could be better, but I want a 5 door hatch, tht eaves the golf and nothing else.

[Biker16]

I don't see anything in what I wrote that said Ford NA is leading the development of the C2 Focus.

 

Finally, global oil prices are what they are, and EU taxes are what they are, and therefore, unless U.S. tax policy 'catches up' with EU tax policy, gas will still be substantially cheaper here.

 

C2 may have originally been scheduled for CY 2010, but word is that it has been pulled ahead, in order to get a more competitive Focus in the U.S. faster. It would be odd, but feasible, for Ford NA to get the C2 Focus a year ahead of Europe. Ford NA needs it more.

 

I still don't know where this myth that C1 is expensive? there is nothing solid that points to why C1 is expensive. I belive that C1 is profitable at 200-300$ more than what C170 would be.

the reason For no C1 is the cost to retool For it and nothing else.

 

Richard if you knew that C1 take s fewer manhours to make than C170, and the european plant is far more efficent than the US plants. Ford N.A. wastes money building the Focus in the US, The european build is far more complex yet they seem to be able to build the car with less labor.

 

SO, you have to fix the productivty gap, before you can even think of bringing C2 to N.A. after you fix that you can afford to have more comonality with the world focus. The parts that hurt the focus's quality were N.A. specific. the less parts in common the more difficult it is For best practices tobe shared beween plants and suppliers. ( FoE has been Focused since the Focus was introduced on reducing prodution costs, by making parts simpler, and reducing the parts counts,in N.A. these improvements were not shared. As Foe Drove costs down F NA did not. )

 

Is still don't know why a minor market like N.A. would get the cars before major makets like europe.

 

Here is a another thought, wuld it worht the trouble to duplicate Focus for here and there. never the less. develop a MPV only For N.A.? I belive both europe and the US will have the same car, minus bumper and minor sheetmetal changes. You can't take too much cost out without killing the archtechture for the 1 million units sold everywhere else.

[silvrsvt]

I still don't know where this myth that C1 is expensive? there is nothing solid that points to why C1 is expensive. I belive that C1 is profitable at 200-300$ more than what C170 would be.

the reason For no C1 is the cost to retool For it and nothing else.

 

Why spend more money on a product that doesnt make any/barely money to start with? Your not going to spend your way out of debt with building a C1 based Focus in the states. As for the more expesive myth then the C170, uh have you seen what Ford has done with the C170 since it launched? For one thing they made it cheaper then the orginal models that launched in 2000. Not to mention that all the C1 based cars sold in the states have a much higher avg selling price then the Focus does. The current Focus is stuck in a B-car price point at a C car expenese. If Ford offered a loss leader B-car, the Focus could move up market and in price also, where they could make $$$ on it. Untill then it wont.

 

 

Richard if you knew that C1 take s fewer manhours to make than C170, and the european plant is far more efficent than the US plants. Ford N.A. wastes money building the Focus in the US, The european build is far more complex yet they seem to be able to build the car with less labor.

wasn't that the point of Ford looking at a new Plant to build the C2 Focus in the Southern US? UAW is an impedament to making US plants more effecent also, requiring changes in working requirements and whatnot to make the plant more effencent.

 

 

 

Is still don't know why a minor market like N.A. would get the cars before major makets like europe.

 

Why not? its far easier to make a "cheap" car more expesive then vise versa and not to mention that we'll be 2 generations behind if we didn't....

[RichardJensen]

You say MPV only for NA, because the C-Max is not based on C1? And the Mazda5 is not based on C1? I was pretty sure both were C1 (hence also C2) based.

 

Regarding the overall cost of the C1, reduced part count doesn't mean reduced part count all the time. Often it means off-loading assembly work to suppliers. Ford has been doing that with NA, as they've been building supplier parks (OAC, Chicago, and Hermosillo). Fields and Smith know they've got to make small cars work, so one assumes that wherever the C2 Focus ends up being built, they will have a supplier park furnishing a smaller number of more completely assembled components.

 

As far as the cost of C1 goes, I'd have to dig up the article that references the typical 'unnamed' person at Ford saying NA was never even considered for C1, and that certain considerations (including cost) were therefore never taken into account. You trust me, or do you want me to dig up the link?

 

A thing to consider: If C1 is profitable at a $300 higher transaction price, then assume that Ford only gets a $150 higher transaction price from the new Focus (which, IMO, looks too much like the old Focus to overcome the Focus' rep in the U.S.). So let's say Ford gets an extra $150 for each Focus. That means that they're LOSING an extra $150 per Focus, for a grand total of about an extra $32M a year, lost, because they brought the C1 over.

Edited August 8, 2006 by RichardJensen

[waymondospiff]

I've no idea on the costs involved in C1 vs. C170 vs. C2. But, referencing *if* C1 only costs $200-300 more to build and if that'd be reflected in the average selling price of the Focus...yeah.

 

Would you pay $300 more for this:

 

...over this:

 

The EuroFocus C1 is the equal of anything in the compact class. Even the almighty VW Rabbit/Jetta. This car would net Ford a much higher transaction price than the current Focus. $200-300 more? Easy. $2000-3000 more? Probably not, but maybe. What is the average transaction price for a Mazda3 vs. an AmeriFocus C170? That's probably the best measure of the C1's worth & value to the US market.

 

Scott

Edited August 8, 2006 by waymondospiff

[RichardJensen]

This car would net Ford a much higher transaction price than the current Focus. $200-300 more? Easy. $2000-3000 more? Probably not, but maybe.

I would say any amount over $1k is extremely unlikely, any amount over $500k improbable.

 

It still looks like a Focus. Consumers have this crazy 'looks like a duck, quacks like a duck' attitude about things. If it looks like a car with a bad reputation, they're not even going to look twice.

 

Even with a totally new look, I still don't think you'd get a substantially higher transaction price. You might get a higher class of purchasers, buying better equipped models, but I don't think you'd see much movement on a trim level to trim level basis.

[mrballsonya]

I think that is the key and is missed nearly 100% of the time by "analysts." There is nothing wrong with Jaguar that new, killer products won't help.

 

Scott

 

 

:lol: :lol: :lol:

Ah! Yes..... Killer Products. Unfortunately it's not just Jaguar that is afflicted with the scourge of stale, understyled, lackluster products... It's seems as if PAPA FORD has far bigger issues with vehicles that nobody wants to buy.

 

I'm sorry... I'm not making light of your comments, I agree with your Killer product credo 100%. I'm just laughing because with the exception of the mustang and possibly the fusion triplets, Ford has offered nothing in the way of product for 5+ years.

[silvrsvt]

I'm sorry... I'm not making light of your comments, I agree with your Killer product credo 100%. I'm just laughing because with the exception of the mustang and possibly the fusion triplets, Ford has offered nothing in the way of product for 5+ years.

 

And the reason for that is management totally dropped the ball in the mid 1990's, when Ford went to make $27 billion in 1997/98.

[waymondospiff]

I'm sorry... I'm not making light of your comments, I agree with your Killer product credo 100%. I'm just laughing because with the exception of the mustang and possibly the fusion triplets, Ford has offered nothing in the way of product for 5+ years.

 

Yes, but the comment refers to is Jaguar UNABLE to make a profit. And the answer is no, Jaguar can make money, they just need the products necessary to sell and make money. Despite their high costs and dated factories, Jaguar could still make money.

 

And your own statement means Ford *can* make killer products, if they try. That may sound like a childish statement, "try harder!" but it's quite accurate for Ford. Ford accepted the dowdy styling of the 500, the no-change restyle of the Explorer, etc. and is now living with the poor market response. But the C1 Focus (Mz3/Mz5/S40/V50/C70), F-150, Mustang, and CD3 (Mazda6/Fusion/Edge/Milan/MKZ/MKX) show the capabilities of Ford.

 

The showroom may be light now, but past performance isn't necessarily an indication of future performance.

 

Scott

[Edstock]

"and dated factories"

 

The X-type factory is state-of-the-art; the other sites work low volume aluminum high-tech assembly for the XK/XJ cars.

[Biker16]

You say MPV only for NA, because the C-Max is not based on C1? And the Mazda5 is not based on C1? I was pretty sure both were C1 (hence also C2) based.

 

Regarding the overall cost of the C1, reduced part count doesn't mean reduced part count all the time. Often it means off-loading assembly work to suppliers. Ford has been doing that with NA, as they've been building supplier parks (OAC, Chicago, and Hermosillo). Fields and Smith know they've got to make small cars work, so one assumes that wherever the C2 Focus ends up being built, they will have a supplier park furnishing a smaller number of more completely assembled components.

 

As far as the cost of C1 goes, I'd have to dig up the article that references the typical 'unnamed' person at Ford saying NA was never even considered for C1, and that certain considerations (including cost) were therefore never taken into account. You trust me, or do you want me to dig up the link?

 

A thing to consider: If C1 is profitable at a $300 higher transaction price, then assume that Ford only gets a $150 higher transaction price from the new Focus (which, IMO, looks too much like the old Focus to overcome the Focus' rep in the U.S.). So let's say Ford gets an extra $150 for each Focus. That means that they're LOSING an extra $150 per Focus, for a grand total of about an extra $32M a year, lost, because they brought the C1 over.

 

outsourcing has been done and will continue to be done. There has been a determined effort to reduce the number of fasteners needed on C1 vs C170. C2 will be the first test of the gloabl supplier concept, where a core of suppliers with global reach, will make C2 components on every continent Ford makes C2s on.

 

There C1 also used fauaricia as its interior supplier and not vistieon as C170 still uses today. Fauricia is a lower cost supplier.

 

Btw to clarifiy "I belive that C1 is profitable at 200-300$ more than what C170 would be. " I meant what C170 would be profitable at. and that is a ASP of about 16-17k I have never in my life susgested that the focus should start at 20k. it should start at 16k with an ASP of 18k that is safely profitable.

 

 

C1 Focus does not look like the c170 Focus that like saying the Mz3 looks like the protege. it don't they share cues but the design is stronger.

 

here my album from the 2004 paris auto show http://www.imagestation.com/album/pictures...l?id=3344175093