Ford doing well globally, just not in the U.S.
That's the gist of Chairman and CEO Bill Ford's statement to the annual meeting of Ford Motor Co. shareholders Thursday.Saying that the company's long-term success depends on its global expansion, Ford emphasized that, despite its problems at home, all of the company's automotive operations outside North America are profitable. He went on to say that Ford Motor is aggressively targeting emerging markets, including Turkey, Russia, India and China, as avenues for future growth.
Ford reaffirmed the company's commitment to return its North American operations to profitability by 2008, and his personal commitment to forego a salary until that goal is met.
Responding to questions from shareholders, Ford said the company is considering adding a plug-in hybrid to its model range, while aggressively pursuing other ethanol, biofuel and hybrid solutions to rising petro-fuel prices and their impact on his company's revenues. He also stressed that overall Ford Motor's lineup is getting smaller and more fuel efficient.
[Sources: Ford Motor Co., Reuters]
Reader Comments (Page 1 of 1)
Owen 1:29PM (5/11/2006)
So Ford is saying, by increasing fuel effeciency, they hope to become profitable in North America again? How long will it take for that to catch on with the public, Toyota and Honda (just to name two) already have such a well established name in fuel efficient cars...
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Secret Squirrel 1:52PM (5/11/2006)
I guess this proves that Ford's european vehicles are quite popular and should think about being brought to america. Toyota is to Scion as Ford is to Cosworth?! =)
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bri 2:07PM (5/11/2006)
Cosworth? maybe. Better yet, the Euro Focus could only help. Saturn is basically euro Chevys.
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lackeard75 2:16PM (5/11/2006)
This makes absolute sense. Ford in other markets has product worth buying or suited for the market at a functional level instead of an emotional level.
Being a former long term resident of Turkey I can tell you that absolutely NO one drives a F-150 (or that type of vehicle), but rather inexpensive transport vans (built in Turkey) or inexpensive passenger vehicles (also built locally). Turkey has a population of 70+ million people, who really cannot afford Acura's or BMW's.
Turkish politics is of a special bread as well, if you were to buy a Honda Civic (with absolutely no opptions) it would cost you $30,000 easily, however you can buy a similarily equipped however far inferior domestically produced FORD partnership or much better Toyota partnership (Corolla) vehicle for less than $15,000. Import vehicles are taxed, dutied then re-taxed again resulting in final sale prices exactly double the MSRP.
That being said, Ford's reputation in markets where emotion does play a role is also more successful than domestic sentiment as of late because vehicle that still evoke emotion are being produced. This is by NO strecth of the imagination a new phenomenon, Ford has been cultivating this image (intentional or not) for a long time. Case in point Ford / Cosworth's Escort right up to the European spec Focus. I have been fortunate to drive Ford products over the years while in Europe and there is a difference!
I had driven the Focus in Europe and was utterly impressed. I had a chat with a Ford rep back in 1995 when the Focus was first introduced to Canada and she pointed out that the Canadian market vehicle gets the European designed sport bucket seats but that the US version received the wider US spec seat because the average target customer was considerably wider than the target customer from other marekts. Of course this rep was not so polite, and the point of this comment is not to call Amercians fat, but rather to show that US spec vehicle suffer for many reasons leaving a few halo cars and thats it. The substanance which creates the passion or the inate desire for pure functionality which are the reasons why Ford is successful in other markets is slowly withering away in the US.
This is common to other manufacturs as well, BMW, AUDI, VOLKSWAGON, TOYOTA, etc absolutely do not include cup holders on there non US vehicles, however (and this is more prominent of vehicle from the early to late 90's) cup holders are added as really well design spring loaded contraptions that pop in an out of the space just above or below you HVAC or stereo. HMMM, lets see if we can spill that coffee on our new Alpine deck.
Another case in point, BMW's M3 of the 90's had 300+ in every market except the US where it was 240hp due to regulations and standards.
These little idio-synchrocies and differences in how the US demographic range view, legislate, desire, use and even build vehicles dictates reduced success as measured by sales. How can we blame GM or Ford for what would seem whimsical re-badging with absolutely no ryhme or reason when there exists over 50 different target groups for the same product with small iteration amognst them. The fault lies in poor business models yes, but the public is what caused the premise to follow these non-economical business solutions.
The enthusiasts that read magazines and participate on these forums and consume vehicles with a passion are just a small percentage of what the OEMs need to figure out. Toyota has a perceived image of quality, you and I both know that quality is not black and white, but for many families its just that... a perceived level of quality.
Mercedes was good in 1979, as a matter of fact it was the best in 1979, therefore it must be the best today? We have an entirely new generation of pseudo car experts who are saying the same about Toyota today (which could very well be the truth) but the European and Asian markets don't have large percentages of people with exhuberebt amounts of expendable income to be considering the car with parking assistance or sunroof or even consider 28" dubs as an aftermarket idea.
What makes the US such a wonderful place is its diversity and the lack of conformity which ironically is the challenge for the automotive marketing experts and the root cause of why GM, FORD and Chrysler have there hands full with competition that did not exist as recent as a decade ago.
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Elliott 2:22PM (5/11/2006)
A joke for anyone who attended or watched the meeting:
Vot about shmall karss? Pipple do not vant BEEG karss! Da price uv gass is rrrridiculous!!!
Oh yeah, and why is Bill Ford on the board of E-bay and not Tiffany's.
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epp_b 3:24PM (5/11/2006)
Well, duh! Have you *seen* what Ford sells in the U.K. and Australia for example? I mean, look at this...
American Ford Focus
http://images.forbes.com/images/2001/04/02/vow_top_377x267.jpg
U.K. Ford Focus
http://www.smartlease.co.uk/focus%20st%203%20door.jpg
I mean, the American version has a weak engine tries to be a cutsey little fashion statement. The U.K. version looks sharp and cunning. It also comes in a hot-hatch 200-or-so BHP version.
And what about the midsize class? Australia gets the Falcon, and we get the Five Hundred vanilla-mobile??
Come ON Ford! Maybe if you sell cars in North America that are worth looking at and driving (let alone paying actual money for), you might do just a wee bit better.
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bri 3:46PM (5/11/2006)
#1 They already have - Ford hybrid sales up 115%. You can't make a large truck very fuel efficient no matter how you slice it, and they've relied on trucks to drive sales for very long. That's what the article is saying. But a Ford Focus is inefficient somehow?
FYI Dearborn may very well be the first with a plug-in hybrid (to expand their line of hybrid cars). After being the 1st hybrid SUV...
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Yaroukh 4:17PM (5/11/2006)
#2: Cosworth+Ford is history; I believe these days Cosworth is rather closer to VW
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Steve 4:18PM (5/11/2006)
With Ford, Daimler and GM we will extend White dominance and power and completely crush the asians. Asians are loosers, they are our slaves, we sell them luxury vehicles and these idiots buy our rolls-royce and land rovers and jaguars, thinking that they have arrived and are successful.
We use these billions of dollars of luxury profits (as taxes) to build our military to show these loosers their proper place globally.
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.T 5:08PM (5/11/2006)
"Ford emphasized that, despite its problems at home, all of the company's automotive operations outside North America are profitable"
Really? So then I take it JAGUAR finally turned a profit?
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burgle 5:17PM (5/11/2006)
lackeard75 - There is not a big import tax in Turkey as far as I know, it is a customs union member and can not put an import tax on the goods coming from other custom union members. Also Toyota costs as much as Civic ?n Turkey (for models that have same engine volumes, otherwise cars with bigger engines have much higher taxes).
Ford is doing ok in Europe but saying it is succesful would be wrong. They are succesful with transport vans but in Western Europe it is only a fraction on the car market. Also compared to other major brands Ford sells the cheapest cars (I guess only in Italia Ford has higher profit margins because it is positioned as a German brand). Even Renault and Peugoet will cost more than a Ford. They are currently selling well but because they are competing usually with Asian automakers there is a big price pressure. So if the US branch goes banktrupt they will face serious problems in other countries too.
I think Ford makes good cars and offer great prices; but their designs are terrible. You should check European Fusion, it is one of the ugliest cars I have seen.
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naggs 6:02PM (5/11/2006)
good one steve, hilarious. it is a fact that ford has better products in europe than the us and the prices that they can charge for their vehicles reflect that.
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naggs 6:06PM (5/11/2006)
"Ford emphasized that, despite its problems at home, all of the company's automotive operations outside North America are profitable"
they never said that every brand in every region was profitable. jaguar is still a money pit
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Bigel 10:44PM (5/11/2006)
Didn't the Australian government just provide Ford Australia with a $40M bailout?
http://www.autoblog.com/2006/05/07/ford-gets-government-bailout-down-under/
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Tony 2:42AM (5/12/2006)
Well duh! Ford Europe gets the good FORDS while US gets the watered down FORDS. Isnt that such a basic marketing analysis? And yet they are parading this BOLD MOVES slogan. BOLD MOVE? Well which product can they consider with the BOLD MOVE?
BOLD MOVES? I dont think Ford is being aggresive enough to use that as their slogan. Here's what i think Ford should do to be able to say BOLD MOVES. First, 200 hp in Five Hundred and Freestyle is very lame.Its like America itself, heavy and slow. Styling is subpar, and 200 hp? How about installing the new 3.5L V6 with 260 hp? Rework the Five hundred to look as cool as the Fusion and for Freestyle use the S-Max as inspiration. And dont forget to use the 300 hp V8 engine. Now thats a BOLD move;
Second. Ford says the Focus flatform is expensive so its not using it for Focus but funny thing its using it for Mazda 3. If you dont want to use the flatform for Focus then use it for a Mercury version. Isnt it Mercury cars are supposed to be more upscale than Ford? Then build a Mercury version of the Focus of Europe. BOLD MOVE;.
Third. They hit it good with the EDGE. But it isnt BOLD enough. Ford is leader in providing third row seat accomodation, so why would they not put a third row with the EDGE? Is it a BOLD MOVE? Nah i dont think so. Put in a third row seat then we're talking more market for the EDGE. And dont forget to put in the 300 hp V8 for the Lincoln version. BOLD MOVE? I think so.
Fourth. The 2006 Explorer is very competent SUV. SO why it isnt selling well? 210 hp V6 with a very dismall MPG and styling. Scrap the 4.0 V6, rework the 3.5 V6 engine to provide even more torque and thats a winner in performance and MPG. And pls pls revise the styling of the Explorer quickly before it becomes the next Taurus.
Fifth. If they are really being BOLD then bring in a small ala Yaris in size. How abt the Fiesta from Europe? It starts with F?
Ford mentioned that their doing better business globally (other than North America of course). Easy, they got a very competitive line up. This is how I see the car line up of each of the Big Auto manufacturers. FORD - Fusion: TOYOTA - Camry, Corolla, Prius Hybrid; HONDA - Accord, Civic; GM - mmmm nothing really; NISSAN - Altima.
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PJ 4:08AM (5/12/2006)
Steve - remind me to write a note to myself that you're completely insane and never to read a comment of yours again.
Incidentally, the supreme White North Americans are doing a pretty good job of snapping up Lexuses, Infinitis, Acuras, Toyotas, and so forth. I assume you'll have a reason fo all this that involves intricate "strategery."
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Tony 1:24AM (5/13/2006)
It's OK bro .. since Lexus is just the best selling luxury brand in US and Infiniti and Acura aren't far behind. Cadillac? good thing it has the Escalade its a very cool brand image, but how abt Lincoln? Navigator used to be the coolest full-sized luxury SUV but its underpowered. Lincoln LS were pretty good but timid styling n weak engines. Ford has to realize that in order to survive they have to be aggressive. THe company is playing catch up all the time.
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