Ford to shift Focus production to China in 2019

[Pioneer]

If she doesn't like the height, what about a C-max?

[fuzzymoomoo]

If she doesn't like the height, what about a C-max?

We thought about that but I was looking at one last night and the way the battery sits, we wouldn't be able to fit the stroller in the back of it.

[630land]

Back when gas was 4-5 bucks, some were going "from now on, people will pay full sticker for a Focus Titanium". And, "everyone will be in a compact car like EU".

 

Gas is cheap again, and now it's like the 90's with small cars having huge rebates to move them. So stockholders are now saying 'kill all cars'.

 

As if Ford is has a crystal ball to "know" sudden market changes to re-tool overnight for trucks, trucks, and more trucks. And whip up a 'driverless CUV' for "about $25,000" from thin air.

 

2008: "Why can't they build more small cars!"

Now: "Why are they building small cars, no one wants them!"

 

Vicious cycle goes back decades. 1958 Edsel flopped since it was a recession "How could Ford bring out such a car, didn't they know people want to save $$$?" So, 1960 Falcon, while a hit, then a few years later, it's "muscle car mania". Then 1970 recession with '$1995 Maverick', then short recovery with huge 1973 LTD's, gas crisis 1 and 2, then mid 80's comeback of Panthers,.....

Edited June 23, 2017 by 630land

[akirby]

But that's why it's important to have a well balanced portfolio of products so you can adjust to changing market conditions.

[2b2]

that's why I rant for flexible assemblylines ... like I *hear* other mfgs have = not one platform per plant

 

 

** no idea how true that is

Edited June 23, 2017 by 2b2

[SoonerLS]

that's why I rant for flexible assemblylines ... like I *hear* other mfgs have = not one platform per plant

 

 

** no idea how true that is

Ford does flex lines (supposedly, the inability to make it flex was a key factor in shuttering Wixom). Not that flex would help in this case--it doesn't help to move the product from one higher-cost plant to another higher-cost plant if what you're needing is lower cost product.

[fuzzymoomoo]

that's why I rant for flexible assemblylines ... like I *hear* other mfgs have = not one platform per plant

 

 

** no idea how true that is

well you have FRAP that technically has 2 platforms, then there's Oakville that builds 2 different platforms....

[snooter]

Ford does flex lines (supposedly, the inability to make it flex was a key factor in shuttering Wixom). Not that flex would help in this case--it doesn't help to move the product from one higher-cost plant to another higher-cost plant if what you're needing is lower cost product.

Well china has that low cost utilization and labor cost you request...dam certain there will never be any work revolts or organized labor either to deal with..if you want profit think china..its the future of auto manufacturing...just ask ford management

[tbone]

Well china has that low cost utilization and labor cost you request...dam certain there will never be any work revolts or organized labor either to deal with..if you want profit think china..its the future of auto manufacturing...just ask ford management

This sounds like an endorsement of the management's decision.

Edited June 23, 2017 by tbone

[snooter]

This sounds like an endorsement of the management's decision.

I dont like it..but its the reality...mexico would have been better than china..id like a detroit built car but thats soon to be only a historical conversation of what the hell went wrong with detroit

 

Ps..i aint buying no gm crap..forget it..

[fuzzymoomoo]

This sounds like an endorsement of the management's decision.

he hates unions, he's made that perfectly clear

[jpd80]

that's why I rant for flexible assemblylines ... like I *hear* other mfgs have = not one platform per plant

 

 

** no idea how true that is

If you look at Ford, the most efficient manufacturing model is still one platform per plant producing high volume on three shifts.

 

I know that Ford has proclaimed flex manufacturing in the past but I think the economic reality is that separate manufacturing and

supplier park set up is more efficient for higher volume runs, flex manufacturing comes into play when the volumes are much lower.

 

I doubt that we will ever see Valencia style flexibility in North America as building up to six different vehicles is one plant

is just not needed. Any shortfall in production capacity should be covered by an overflow plant building another model.

[bzcat]

that's why I rant for flexible assemblylines ... like I *hear* other mfgs have = not one platform per plant

 

 

** no idea how true that is

 

LOL, flexible assembly? That sounds like some black magic wizardry!

 

The issue with Ford is not that it doesn't have flexible assembly. The issue is capacity and lower marginal profit on certain products. In theory, Ford could build Focus at Louisville with Escape, or in Oakville with Edge, or in Flat Rock with Continental, or in Hemosillo with Fusion. But in each case, you can see that doing so will by necessity reduce the output volume of a more profitable vehicle. Field's solution was to add another plant into the mix - Saint Luis Potosi was going to be Focus + something else. But that plan went out the window for reasons that is still not entirely clear. The assumption we are working with now (the only one Ford offered) is that Ford would save $1 billion by not building Saint Luis Potosi plant. But that implies that Ford feels it has plenty of capacity otherwise to supply the North America region. I don't think this is true after you take into account that Flat Rock is going to convert to Model E production and supply the entire world.

Edited June 27, 2017 by bzcat

[rmc523]

 

LOL, flexible assembly? That sounds like some black magic wizardry!

 

The issue with Ford is not that it doesn't have flexible assembly. The issue is capacity and lower marginal profit on certain products. In theory, Ford could build Focus at Louisville with Escape, or in Oakville with Edge, or in Flat Rock with Continental, or in Hemosillo with Fusion. But in each case, you can see that doing so will by necessity reduce the output volume of a more profitable vehicle. Field's solution was to add another plant into the mix - Saint Luis Potosi was going to be Focus + something else. But that plan went out the window for reasons that is still not entirely clear. The assumption we are working with now (the only one Ford offered) is that Ford would save $1 billion by not building Saint Luis Potosi plant. But that implies that Ford feels it has plenty of capacity otherwise to supply the North America region. I don't think this is true after you take into account that Flat Rock is going to convert to Model E production and supply the entire world.

 

Flat Rock is not "converting" to Model E production.

 

It's expanding factory capacity and adding Model E production to the models it already has.

[jpd80]

Ye world was in a very different place when Ford was talking about Flex manufacturing, the reality today

with low gas prices is that buyers in North America are moving away from Focus and Fusion

to Utilities and trucks - those are the vehicles that pay the bills and seeing growth in sales

and transaction prices.

 

I'm still shocked that it's cheaper for Ford to build Focus in an existing Chinese plant and ship them to North America,

if they can do that successfully (without much blow back) then it opens the possibility of perhaps other vehicle

being considered.... I don't like it but I wonder f this is for testing the water...

[rmc523]

Ye world was in a very different place when Ford was talking about Flex manufacturing, the reality today

with low gas prices is that buyers in North America are moving away from Focus and Fusion

to Utilities and trucks - those are the vehicles that pay the bills and seeing growth in sales

and transaction prices.

 

I'm still shocked that it's cheaper for Ford to build Focus in an existing Chinese plant and ship them to North America,

if they can do that successfully (without much blow back) then it opens the possibility of perhaps other vehicle

being considered.... I don't like it but I wonder f this is for testing the water...

 

It could open the door for MKC production in China and importing some of them here. Unless MKC shifts out of Louisville altogether (giving Escape more production capacity) and goes China only, with exports coming here.

 

I recall there being talk of producing MKC there, but at the time, we figured it'd be for the Chinese market.

[tbone]

Ye world was in a very different place when Ford was talking about Flex manufacturing, the reality today

with low gas prices is that buyers in North America are moving away from Focus and Fusion

to Utilities and trucks - those are the vehicles that pay the bills and seeing growth in sales

and transaction prices.

 

I'm still shocked that it's cheaper for Ford to build Focus in an existing Chinese plant and ship them to North America,

if they can do that successfully (without much blow back) then it opens the possibility of perhaps other vehicle

being considered.... I don't like it but I wonder f this is for testing the water...

Didn't Ford make a statement that it was not cheaper to ship the focus from China?

[630land]

It's not cheaper, but they save $1B, by not building a whole plant in MEX. They probably want to keep capacity available at the Fusion plant for a truck/UV instead of Focuses.

 

My beef overall is US car makers are now treating buyers who want to save operating costs as unwanted. "Oh you should buy a truck so we can make $$$", and of course, "trade in every few years". But not everyone wants to drive a 21ish mpg truck to work 50 miles a day to "fit in with cool folks at the office".

[jcartwright99]

It's not cheaper, but they save $1B, by not building a whole plant in MEX. They probably want to keep capacity available at the Fusion plant for a truck/UV instead of Focuses.

 

My beef overall is US car makers are now treating buyers who want to save operating costs as unwanted. "Oh you should buy a truck so we can make $$$", and of course, "trade in every few years". But not everyone wants to drive a 21ish mpg truck to work 50 miles a day to "fit in with cool folks at the office".

 

Actually (using Ford as an example), they aren't treating you as unwanted as they sell Fiesta, Focus (even with the gap), and Fusion. All of those are not neglecting the folks who value operating costs. However, I would argue that the consumer (and gas prices) are dictating the CUV/SUV/Truck market. Ford is smart to build what is selling. So blame your neighbor who bought the Expedition and F150 with no use for it but don't blame Ford for selling it to him and making a profit.

Edited June 27, 2017 by jcartwright99

[snooter]

Actually (using Ford as an example), they aren't treating you as unwanted as they sell Fiesta, Focus (even with the gap), and Fusion. All of those are not neglecting the folks who value operating costs. However, I would argue that the consumer (and gas prices) are dictating the CUV/SUV/Truck market. Ford is smart to build what is selling. So blame your neighbor who bought the Expedition and F150 with no use for it but don't blame Ford for selling it to him and making a profit.

True..but what is concerning is if ford has the ability to quickly ramp up small car production when a gas cruch again occurs or is this time like the ford of 1973??..going out on a limb here..but by late summer i would bet gas prices are near $1.50 and suv sales are thru the roof...i just hope ford has not gotten to fat and too lazy along with the drunkeness with the profits that are now rolling in to prepare for a rainy day...i still dont like foci in china..but we had the experiment with seeing if detroit can build a small car with profit (they could not)..now its the experiment to see if we will buy china built cars..

[Fordowner]

The whole billion dollar savings always seems oddly worded - like this phrase

"Ford will trim about $500 million in costs by shifting production to China, adding to the $500 million already saved from canceling construction of a small-car factory in Mexico earlier this year."

 

Regardless, I hope this experiment with building a major line (Focus) in China fails. Our current trade deficit with China is so huge and one sided it really seems unsustainable.

[SoonerLS]

Didn't Ford make a statement that it was not cheaper to ship the focus from China?

They only said it wasn't cheaper than building the Focus in Mexico.

[jpd80]

I think it's Ford moving the costs of NG Focus off the North American books

and simply importing it from China (shared production in an existing plant)

[twintornados]

They only said it wasn't cheaper than building the Focus in Mexico.

.

I believe the savings come from the fact there is a plant in China already producing Focus and not one in Mexico...

[ehaase]

I wouldn't be surprised if Chinese Focus sales are 100,000 per year or less. That may be the natural demand for Ford compact sales in the US, as Ford has probably burned a lot of good will among small car buyers with all the problems the original 2000 model year Focus and the current version have had.