Ford shitcanning all its cars but the Mustang.

[12,000 RPM]

Makes no sense to develop cars to sell at a loss. You are right that there may be some CAFE nonsense going on, but factoring in retail prices its not unfair to figure they are losing money. The Focus/Fusion are selling for like 10% below invoice... that's extreme even for the D3

[AutobahnSHO]

Does it seem like it would take more design/enginerding to build a car compared to an SUV/truck?

The basic model for Trucks is unchaged, and plenty of room (under hood, cab, bed) to move components or tweak the design. Seems like it would take more work to design a decent car.

[Lebowski]

Meh... Wouldn't be surprised if this doesn't end up as a giant PR stunt to give Trump ammo to kill CAFE standards

The focus and fusion are world cars.  They are still being developed.  You would think to offest the development costs they would try to sell them globally.  The US restrictions just point towards less of "we can't make them profitable" and more towards a cafe political statement and/or trying to brainwash their customers into more expensive crossovers

I wouldn't doubt there bring a press conference in a few months with CAFE standards being dropped and Trump declaring how he just saved thousands of jobs

Are you saying Ford intentionally lost money on cars for ~20 years as part of a conspiracy and in anticipate of a Trump presidency to get rid of CAFE?

[12,000 RPM]

Does it seem like it would take more design/enginerding to build a car compared to an SUV/truck?

The basic model for Trucks is unchaged, and plenty of room (under hood, cab, bed) to move components or tweak the design. Seems like it would take more work to design a decent car.

I would say trucks and crossovers require more engineering. I don't think engineering is a huge piece of the cost though.

[r0tor]

Are you saying Ford intentionally lost money on cars for ~20 years as part of a conspiracy and in anticipate of a Trump presidency to get rid of CAFE?

Correct me if I'm going, but Ford doesn't release actual profit statements on a per vehicle or per segment basis?

[r0tor]

This is a nice 2008 article

Ford Loses $8.7 Billion; Moving to Smaller Cars
https://www.cnbc.com/id/25828411
Ford also announced a sweeping realignment of its North American operations intended to reduce its reliance on trucks and SUVs by rolling out a range of smaller, more fuel-efficient vehicles and converting three truck plants to make cars.

[Lebowski]

Correct me if I'm going, but Ford doesn't release actual profit statements on a per vehicle or per segment basis?

Everything I've seen/read indicates Ford hasn't made money in cars on any consistent basis and I've never seen a credible case made to the contrary.

So is your position now that Ford does consistently make money on cars and is exiting a profitable segment as part of a Trumpian conspiracy to kill cafe?

[r0tor]

Everything I've seen/read indicates Ford hasn't made money in cars on any consistent basis and I've never seen a credible case made to the contrary.

So is your position now that Ford does consistently make money on cars and is exiting a profitable segment as part of a Trumpian conspiracy to kill cafe?

So if Ford doesn't release the numbers, "everything you read" is ???

[12,000 RPM]

This is a nice 2008 article

Ford Loses $8.7 Billion; Moving to Smaller Cars
https://www.cnbc.com/id/25828411
Ford also announced a sweeping realignment of its North American operations intended to reduce its reliance on trucks and SUVs by rolling out a range of smaller, more fuel-efficient vehicles and converting three truck plants to make cars.

A lot has changed in 10 years.

[CaminoRacer]

A lot has changed in 10 years.

Yeah but the argument put forth so far has been that Ford has been losing money on cars for decades.

[Lebowski]

So if Ford doesn't release the numbers, "everything you read" is ???

Estimates, based on large part on public information Ford and peers do release (production volumes, transaction prices, capacity/utilization, labor costs, material costs, commentary wrt contribution margins by class etc). If you've put together better estimates by all means share them, in the meantime it's hardly controversial to say Ford loses money in cars, and that the mainstream car market is low margin even for better run import competitors.

[12,000 RPM]

Yeah but the argument put forth so far has been that Ford has been losing money on cars for decades.

They probably shifted from prioritizing market share to profit (albeit pretty damn abruptly).

[shp4man]

We watched a video put out by Ford on this today. It basically said with no mileage penalty, 75% of buyers prefer the added interior space in all segments.

[CaminoRacer]

We watched a video put out by Ford on this today. It basically said with no mileage penalty, 75% of buyers prefer the added interior space in all segments.

75% of buyers are hoarders.

[SJ_GTI]

75% of buyers prefer more space 100% of the time. 

[2o6]

We watched a video put out by Ford on this today. It basically said with no mileage penalty, 75% of buyers prefer the added interior space in all segments.

Funny; a lot of Ford vehicles are mediocre with respect to interior space.

[r0tor]

Estimates, based on large part on public information Ford and peers do release (production volumes, transaction prices, capacity/utilization, labor costs, material costs, commentary wrt contribution margins by class etc). If you've put together better estimates by all means share them, in the meantime it's hardly controversial to say Ford loses money in cars, and that the mainstream car market is low margin even for better run import competitors.

So junk you make up.. ok

[Lebowski]

So junk you make up.. ok

An example of making something up would be your cafe consipiracy theory, which is nonsensical regardless of passenger cars' profitability.

[r0tor]

An example of making something up would be your cafe consipiracy theory, which is nonsensical regardless of passenger cars' profitability.

There is a difference between proposing a theory and acting like your opinion is a fact

[CaminoRacer]

An example of making something up would be your cafe consipiracy theory, which is nonsensical regardless of passenger cars' profitability.

Is it really? That's exactly Trump's negotiating style. Seems like a smart business move.

[Lebowski]

There is a difference between proposing a theory and acting like your opinion is a fact

It's not my opinion, it's the opinion of those who follow and publish estimates for the industry and who's research I read. It's also apparently the opinion of Ford management.

[shp4man]

According to the video, it's also a status/coolness thing. SUVs/CUVs are supposedly way more statusy/cooler than sedans or minivans. No kidding. Marketing garbage or real? Not sure.

[shp4man]

Maybe they should do a Mustang wagon thing- like that old Volvo one. 

[93JC]

According to the video, it's also a status/coolness thing. SUVs/CUVs are supposedly way more statusy/cooler than sedans or minivans. No kidding. Marketing garbage or real? Not sure.

CUV/SUV/crossover/whatevers are generally much more spacious and versatile than their sedan/hatchback counterparts, and I believe for that reason alone they're becoming more popular. Of my friends and acquaintances who've bought new cars in the last few years:

• 30 y.o./single/no kids: replaced a GMC Terrain with a Chevy Trax
• 31/longterm relationship/no kids: replaced a Jeep Patriot with a Toyota Tacoma
• 33 & 35/married/one 2 y.o.: replaced a Mazda 3 hatchback with a Ford Explorer; looking to replace a GMC Sierra 1500 with an entry-lux sedan (leaning heavily toward a Genesis G70)
• 33 & 34/married/one 2 y.o.: replaced a Toyota Corolla with a RAV4
• 35/married/one 2 y.o.: replaced a Kia Soul with a Honda Odyssey
• 37/longterm relationship/no kids: replaced a Toyota Tercel with a VW Jetta; Jetta was a lemon, replaced with a VW Golf Wagon
• 43/married/three kids: replaced a Toyota Tacoma with a RAV4
• 30 & 32/married/one kid on the way: bought a Ford F-150 crewcab
• 30 y.o./single/no kids: replaced a Pontiac Grand Prix with a Honda Accord Coupe; regrets this decision, looking to replace it with an SUV
• 34 y.o./single/no kids: bought a Ford Focus, sold it about a year later; lives downtown, didn't need a car at all

The pattern is definitely replacing smaller vehicles with an SUV or truck. The outliers have mitigating circumstances for buying something smaller (e.g. Tercel-->Jetta-->Golf was because an SUV won't fit in their condo parking stall) or regret their decision and want something bigger (e.g. Grand Prix-->Accord).

The only one who went from something bigger to something smaller was the latest one (Terrain-->Trax).

[12,000 RPM]

There is a difference between proposing a theory and acting like your opinion is a fact

You do the latter and act as though you're doing the former....

I mean let's really think the CAFE thing through. If Ford's aim was to get rid of CAFE to be able to stop selling sedans, why would they stop selling sedans BEFORE they got rid of CAFE? How is getting rid of sedans some kind of pitch to get rid of CAFE? The theory doesn't make any sense.

What makes much more sense is that Ford realizes that paying customers to take their cars away is bad business. So they won't sell them where that is the case. Not very hard logic to follow

[r0tor]

They announced the stop sale a few years in advance and ate still making cars... There is now huge pressure and incentive to save tons of jobs sitting out there combined with Trump's hatred of all things environmental and Obama

[12,000 RPM]

As I understand it no US jobs will be lost. They are going to kill overseas production of Fords sold here and use US manufacturing capacity to make nothing but the high profit high riders.

[MX793]

There are different CAFE limits for cars and trucks.  Crossovers are classified as trucks.  By getting rid of cars, Ford doesn't have to worry about the zany car CAFE limit.  By replacing cars with relatively fuel efficient (by truck standards) crossovers, they make it easier for their truck fleet, which is where the volume is, to meet truck CAFE.  Whether Trump backs off on CAFE or not, I suspect it was a motivator here.

[2o6]

There are different CAFE limits for cars and trucks.  Crossovers are classified as trucks.  By getting rid of cars, Ford doesn't have to worry about the zany car CAFE limit.  By replacing cars with relatively fuel efficient (by truck standards) crossovers, they make it easier for their truck fleet, which is where the volume is, to meet truck CAFE.  Whether Trump backs off on CAFE or not, I suspect it was a motivator here.

I wonder if the Focus Active will be classified as a light truck.

[MX793]

I wonder if the Focus Active will be classified as a light truck.

They may need to class it as a car to offset the Mustang, but maybe they can use the 4 banger Stang to keep that out of the penalty.  Or they just eat the penalty since Mustang volume isn't that high.