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Ford to shift Focus production to China in 2019

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Ford tried selling a premium compact car with the Focus being built in the US and between market changes and transmission issues, they were not that successful with it..

 

Ford already stated that cars in this segment are sold on "value" and that buyers don't really care where the car comes from, at least in this segment, since "value" for the dollar is the primary driving concern they have.

 

If someone can afford something better, they'll go with an Escape or a Fusion instead.

 

As for GM building more cars in UAW plants...hate to say it but copying GM isn't always good for your financials.

 

I think the vast majority of people don't give a shit where the car is made...and I'm sure that some BMW and MB buyers think their car/cuv is built in German when it come the South...

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This is a sad day. I used to be proud to work for Ford.

A very sad day. No more able to defend Ford as 'The Only True American Car Company'. The competition has to be relieved...Ford sold out to its loyal customers.

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A very sad day. No more able to defend Ford as 'The Only True American Car Company'. The competition has to be relieved...Ford sold out to its loyal customers.

If you're judging by where they bolt the cars together, Ford hasn't been a "True American Car Company" for a very long time. Personally, I think that's just as silly a metric as the one that has Toyota touting cars.com calling the Camry the "most American car."

Edited by SoonerLS

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If you're judging by where they bolt the cars together, Ford hasn't been a "True American Car Company" for a very long time. Personally, I think that's just as silly a metric as the one that has Toyota touting cars.com calling the Camry the "most American car."

No, not manufacturing or assembly...but rather being a COMPANY with return on investments with American roots for over 100 years. I agree about the cars.com bias article....However, all bets off...I can no longer defend Ford in any discussions on home roots, American Car Company, patriotism, etc....

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This is a test to see if folks will buy a cheaper Focus based on price even if it's imported. I think it's also a bit of a stopgap while they figure out what to do long term in NA. It would not surprise me to see the new Mexico plant resurrected or another U.S. plant opened/reopened/added capacity but that takes more than 18 months.

 

Thanks to poor planning Focus is homeless. I know the feeling - we just sold our house and had to find a rental on short notice. Stressful.

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I think the move is driven by something a bit deeper, which is: the preferences of American buyers at the lower end of the scale (e.g., not luxury) is closer to those of Chinese than European. And if you want scale and efficiency (ie - you don't need two sets of tools), the better to produce it in China.

 

For example, Americans and Chinese value back seat space more than Europeans. Americans and Chinese consumers value quality (different from reliability) less than Europeans - so the return on material selection is lower for those markets, e.g., harder plastics, faker leather, etc.

 

Foci will be produced in essentially two large locations: one in Europe that caters to more European tastes + performance vehicles and one China that caters to the rest of the world's standards. This means I expect wheelbase and dimensions to vary a bit by where the car is sourced (we'll see if I'm right).

 

You could argue that somehow Honda manages the Civic in the US, but to that I'll say the Focus does not effectively match the needs of the average American small car consumer (yet again) - too little rear seat room, lower reliability, poorer balance on fuel and performance. As a result, the real ATP of a standard Focus (not ST and RS which have limited market appeal) is lower than a Civic while volumes are lower as well. You can imagine the fixed cost of both being similar, which means the net profit is weaker on Focus. In 10 years, depending on the market and Ford's ability to execute the right product efficiently (the real reason for Fields' departure), maybe small car production returns to our shores.

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No, not manufacturing or assembly...but rather being a COMPANY with return on investments with American roots for over 100 years. I agree about the cars.com bias article....However, all bets off...I can no longer defend Ford in any discussions on home roots, American Car Company, patriotism, etc....

 

To this, I would say, patriotism always loses to product in the end. Ford does not have the right product right now in the small car segment. In the long-run, that's the only thing that matters.

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No, not manufacturing or assembly...but rather being a COMPANY with return on investments with American roots for over 100 years. I agree about the cars.com bias article....However, all bets off...I can no longer defend Ford in any discussions on home roots, American Car Company, patriotism, etc....

 

You're ignoring the fact that Ford is and has always been a global manufacturer - building parts in Europe and elsewhere since 1912 and building vehicles there since the 20s.

 

Funny how Canada and Mexico suddenly become part of the US when folks talk about patriotism just because we share a border.

 

Global companies operate globally if they want to succeed.

 

Instead of focusing on individual products why not focus on how many Americans Ford employs and supports.

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Add to that FCA builds all Chrysler,Ram (except Promaster city) and Dodge in UAW plants.

 

All Chrysler branded cars are built in Canada, most Dodge built in Canada or Mexico, and half of Ram is built in Mexico. Jeep is actually the brand with the most American UAW footprint.

 

https://en.wikipedia.org/wiki/List_of_Chrysler_factories

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This is a test to see if folks will buy a cheaper Focus based on price even if it's imported.

Wasn't this test already done?

 

I guess history is not the best teacher.

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Wasn't this test already done?

 

I guess history is not the best teacher.

 

Your missing the part about making a profit off it. For decades, small cars haven't made money for American manufactures. Selling a 20K Focus with almost 3K (which is roughly 15% off the price) off it in incentives isn't conducive to making profits off it.

 

Building in China will hopefully improve the pricing and profitability of the car without resorting to 15% in incentives.

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How can you not? They were the first to try it.

Equinox started using Chinese engines prior to that.

 

RAV4 is also using Chinese engines.

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Your missing the part about making a profit off it. For decades, small cars haven't made money for American manufactures. Selling a 20K Focus with almost 3K (which is roughly 15% off the price) off it in incentives isn't conducive to making profits off it.

 

Building in China will hopefully improve the pricing and profitability of the car without resorting to 15% in incentives.

"Although it is cheaper to build and ship cars to the United States from Mexico than China, "this was not a variable cost decision," Hinrichs said in a briefing on Tuesday" source https://www.reuters.com/article/us-ford-china-idUSKBN19B1RO

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"Although it is cheaper to build and ship cars to the United States from Mexico than China, "this was not a variable cost decision," Hinrichs said in a briefing on Tuesday" source https://www.reuters.com/article/us-ford-china-idUSKBN19B1RO

 

Translation - it's not worth building a new factory in Mexico (fixed costs).

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The better question is how well would it be selling if it were not built in China.

 

I think reality is the vast majority of people don't know where their car is built, and if the car fits the price, quality, and style that they want, they won't really care either.

 

A very sad day. No more able to defend Ford as 'The Only True American Car Company'. The competition has to be relieved...Ford sold out to its loyal customers.

 

No, not manufacturing or assembly...but rather being a COMPANY with return on investments with American roots for over 100 years. I agree about the cars.com bias article....However, all bets off...I can no longer defend Ford in any discussions on home roots, American Car Company, patriotism, etc....

 

I just don't understand where you're coming from. It's not as if every single vehicle Ford has ever made to this point has been made in America and now they're suddenly making something somewhere else. They've made products elsewhere for most of their history, as have other brands. There are no more wholly origin companies, except for maybe some of the Chinese brands. (Meaning there are no major car companies around the world that are exclusive to their home market.

Edited by rmc523

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Bring the politics to off-topic or this thread gets closed.

How can you NOT interject politics into this discussion? I am surprised that we have not had MORE discussion on the subject given the powder keg that exists in N Korea with that whack job running the show and IMO our best chance of getting rid of him is dependent on what China does. And in spite of the fact that the Donald has had "good meetings" with the Chinese, what positive indication do we get from them that they will interject themselves??? Not much IMO.

 

Many seem convinced that we had better deal with this nut BEFORE he has the bomb and a reliable delivery system, yet what leverage do we have. In 30 minutes he can destroy the So Korean economy and kill millions. So what kind of military option does that give us? None!

 

Actually I often think about the roll of the dice that American industry takes when it comes to significant investment in some countries that are less than stable-or consistently friendly to us . Agree its a world economy but the risks IMO go well beyond the pure business case.

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What a difference a decade makes. After the 2008 financial meltdown, Ford and the other domestics were being lambasted for not offering enough fuel-sippers in their respective line-ups. The shift to small cars was supposed to be permanent. But, just like they always have, Americans drifted back to larger vehicles when the economy began recovering and fuel prices eased.

 

It helps that companies, including Ford, have since produced more fuel-efficient crossovers (I'd wager that the Escape has probably stolen more sales from the Focus than any other vehicle). The long-term switch wasn't from body-on-frame Explorers and Trailblazers to Focuses and Cruzes; it was from the old-school SUVs to more efficient crossovers.

 

Americans are reverting to form, and viewing anything smaller than the Accord-Camry-Fusion-Malibu-Sonata as a small - i.e., cheap - car, with the major emphasis on affordability, economy and reliability. If there is any demand for a "premium" small car, it has been fulfilled by the new Civic, which is both roomier and more expensive than the prior generation. But the rumor has been that Honda still loses money on this Civic. The current Civic shares a basic platform with the new CR-V and soon-to-debut Accord, so I can't believe that the company will continue to lose money on it (if Honda ever did).

 

Ford blew a major opportunity with this Focus, between the cramped interior and problematic automatic. We were recently shopping for a new car, and both the cramped back seat and potentially troublesome automatic crossed the Focus off of our list. Which is a shame, because the car looks good and has a nice combination of ride and handling. Maybe the next generation can address those concerns and still make money for Ford.

Edited by grbeck

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The problem I could possibly see with China is that it would not be out of the question that if diplomatic situations go bad, I could see them pull a Venezuela and taking over American owned plants with the technology we share with them. They are not afraid to bluff and gamble because they expect us to cave in and fold our cards even when we have a good hand.

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I still think this is more about factory capacity and timing than anything else.

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Ford blew a major opportunity with this Focus, between the cramped interior and problematic automatic. We were recently shopping for a new car, and both the cramped back seat and potentially troublesome automatic crossed the Focus off of our list. Which is a shame, because the car looks good and has a nice combination of ride and handling. Maybe the next generation can address those concerns and still make money for Ford.

Well said. When we leased our Focus, we had a pretty good idea we would be trying to have a baby soon, and knew the back seat could be a problem for a car seat. Boy we're we right. As he gets bigger and the car seat grows with him, it portrudes further into the front seat area. Its already pretty much sitting at my temple at 4 months old. I hate to get rid of it because a. It's a stick and b. I do truly love it despite its limitations, but it's just not going to work when we decide have our second one.

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So China builds Focus with dumbed down suspension while Europe keeps current suspension, and ships ST/RS here? If not for the PI I'm surprised they didn't dip thier toe in the water with the Taurus. Assuming this was in the works with Fields it was stupid to not announce before giving him the heave ho so as to allow him to take some stink with him.

 

Maybe Fields was against the idea?

 

I think in retrospect you can see that Fields was put in a pickle by the board.

 

Fields was presumably the one who made the call to invest in San Luis Potosí plant in Sep 2016, that got Ford all kinds of bad press from then Candidate Trump.

 

The decision to abandon the project in Jan 2017 to score some cheap political points from President-elect Trump probably had to go to the board for approval. We will never know if Fields was for it or he got overruled. It seemed like a big no-confidence vote on Field's leadership. And sure enough, he was fired last month.

 

But surely when Ford said it was cancelling San Luis Potosi, they had already ran the numbers and know they were going to import Focus from China... the new Chinese plant was a known fact and the production capacity were already baked in at that point.

 

The whole thing was literally political theater. Ford knew Focus was going to China... it was probably the main reason the board decided to cancel San Luis Potosi. Fields (my opinion, not fact) was probably the one that insisted the company continue to invest in Mexico, and he got booted.

Edited by bzcat

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Bring the politics to off-topic or this thread gets closed.

Bottom line if the plant in Mexico had been completed we wouldn't be faced with this bad news about the majority of a major Ford product line with significant history in the U.S. being outsourced to China. Having the plant in Mexico would be far better for our economy and our country's security than having it in China. $462 in Imports from China and only $116 Billion in Exports for a $347 Billion trade deficit vs $294 Billion in imports from Mexico and $231 Billion in Exports for a $63 Billion deficit. They won't be using U.S. steel or parts in the Chinese Focus, like they would have with the North American (Mexico) Focus. So in this discussion its fair to criticize those that have influence over major decisions like this. 1. Why criticize and threaten tariffs for products moved to Mexico but remain silent when they are moved to China? I owned a Kona Edition Focus. I have always owned Fords. But I hate that Ford is the first American Company to source the main supply of a major automotive line. Trump made a mistake. And now Ford is making a mistake. They are related mistakes and mistakes related to this very issue. So would there be two threads? By the way, is Ford really saving $500 million over if they had just completed the plant they wre building? What are the savings after shipping costs? As to Iphone comparisions, true child labor is good for working on small electronics but are children strong enough work on cars?........

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How can you NOT interject politics into this discussion? I am surprised that we have not had MORE discussion on the subject given the powder keg that exists in N Korea with that whack job running the show and IMO our best chance of getting rid of him is dependent on what China does. And in spite of the fact that the Donald has had "good meetings" with the Chinese, what positive indication do we get from them that they will interject themselves??? Not much IMO.

 

 

The posts (that have since been removed) crossed over a line. I'm fine with political posts that are made within the topic of the thread...but when it comes to name calling, and diatribes about "fake news" and similar, it does not belong here and brings no value to the discussion.

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Ford has a history of operating in countries that are not generally favorable to usa interest..irregardless id bet fiesta joins foci in china abd mecico ends up with lower tier suv's such as escape, edge abd the like...at some point ford will test moving some lower level f150 production to mexico..we shall see what the furniture guy does

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