Ford shitcanning all its cars but the Mustang.

[r0tor]

They can announce all the funding they want. This still doesn't explain how Ford is going to make money on cars nobody wants to buy. Even EV tech is not immune. BMW has announced this:

and Tesla has more orders then it can build for years for the 3 sedan.

There is still a strong market for sedans.  They just need to be good sedans

[12,000 RPM]

The Fusion outsells the Edge by a wide wide margin... It's not just a loss for enthusiasts but for average shoppers as well

They are reaching parity. 2 years ago Fusion outsold the Edge 2-3x. Now their monthly sales are separated by 2-3 thousand. Won't be long before the Edge outsells the Fusion (if it lives that long).

I dont take much pleasure in watching this go down. Going to be a lot of lost jobs from the reduced capacity. But it's better for Ford to scale back now and live to fight another day, than throw precious capital after cars nobody wants to save face and make people feel good. Again if the market changes then I'm sure Ford will turn the faucet back on and get that money. But I haven't heard any good business reasons why they should stay in

[12,000 RPM]

and Tesla has more orders then it can build for years for the 3 sedan.

There is still a strong market for sedans.  They just need to be good sedans

Ford's sedans are good. As Tesla demonstrates everyday brand goes very far. Far enough that at times the product can be secondary in the buying decision process.

[r0tor]

Is the fusion that differentiated the average non enthusiast shopper can't find a suitable substitute?  Should Ford keep producing money losing products indefinitely?

Cars sell for what people are willing to pay for them.  Domestic automakers struggle to make profits because they sell boring ass appliances that people are only willing to buy at steep discounts. There is nothing stopping that trend from hitting the SUV market.

This is a typically short sighted finance guy move who is missing the much larger picture.

[Lebowski]

Cars sell for what people are willing to pay for them.  Domestic automakers struggle to make profits because they sell boring ass appliances that people are only willing to buy at steep discounts. There is nothing stopping that trend from hitting the SUV market.

This is a typically short sighted finance guy move who is missing the much larger picture.

I'm confused, if the Fusion is such a "loss for average shoppers" how come they can't sell it for enough to be profitable?


A company striving to earn an economic profit is not short sighted. Ford isn't a charity.

[r0tor]

Ford's sedans are good. As Tesla demonstrates everyday brand goes very far. Far enough that at times the product can be secondary in the buying decision process.

Fords sedan are helplessly in need of a refresh (beyond new bumpers).  I could park my parents 5 year old Fusion Hybrid next to my neighbors brand new Fusion sport and it would be a struggle to figure out which is new.

It's not a big surprise that sales are decreasing

[Lebowski]

and Tesla has more orders then it can build for years for the 3 sedan.

There is still a strong market for sedans.  They just need to be good sedans

If the Model 3 had a Ford badge it wouldn't be selling as well, although ironically Ford might be actually able to produce them.

[r0tor]

I'm confused, if the Fusion is such a "loss for average shoppers" how come they can't sell it for enough to be profitable?


A company striving to earn an economic profit is not short sighted. Ford isn't a charity.

When do you face the music, now or when you can only sell an Edge with negative profits?  Running from sedans is just putting off the inevitable and depending on the market could accelerate their demise.

[2o6]

I get the gist the fusion is profitable.


It's just that CUV's are more profitable

[Lebowski]

When do you face the music, now or when you can only sell an Edge with negative profits?  Running from sedans is just putting off the inevitable and depending on the market could accelerate their demise.

Looks to me they are facing the music.  They are acknowledging they can't make money in cars and making the economically sound decision. 

[Payman]

I get the gist the fusion is profitable.


It’s just that CUV’s are more profitable

Seems people won't pay $20K for a 4 door hatchback, but happily pay $25K for essentially the same vehicle with a bit of cladding and 1/2" taller shocks. Oh, I can get it with AWD? Here's another $5K! Take my money! With 72 months financing my monthly payment is the same as the lowly car! (at 60 months). SO MUCH WIN!

[12,000 RPM]

Fords sedan are helplessly in need of a refresh (beyond new bumpers).  I could park my parents 5 year old Fusion Hybrid next to my neighbors brand new Fusion sport and it would be a struggle to figure out which is new.

It's not a big surprise that sales are decreasing

Several of the Fusion's competitors have refreshed over its lifetime. The Malibu, Sonata and Optima are all new, and all in equally bad shape sales wise.

Bottom line, only companies that can move decent volume at decent margin in this space are Honda and Toyota. Ford can build cars that are as good (or better- Focus is better than the last Civic and all Corollas IMO) and it's not enough. At a certain point brand trumps all, even in the mainstream space

[HurricaneSteve]

It's too bad but if they're losing that kind of money on sedans then it's probably best to pull the plug. It's a shame because I nearly pulled the trigger on a 2018 Fiesta Hatchback 5MT for 12.9K a month ago and was a good amount of car for the cash.

[12,000 RPM]

When do you face the music, now or when you can only sell an Edge with negative profits?  Running from sedans is just putting off the inevitable and depending on the market could accelerate their demise.

This makes no sense.... for the last 20 years, Ford has struggled with sedans and thrived on trucks/SUVs in the US. The only things that have changed are that those trucks/SUVs get livable fuel economy, and Ford is finally willing to make profit, rather than market share, a priority. Market presence is worthless if it comes at the expense of profit.

[12,000 RPM]

I get the gist the fusion is profitable.


It's just that CUV's are more profitable

I feel like the difference in MSRP between an equally equipped Edge and Fusion is like $3-5K. But the actual transaction price difference is like $10K.

You flip cars.... if you could double or triple your profit on every flip for the same amount of work just by focusing on certain cars, why wouldn't you?

[HurricaneSteve]

Several of the Fusion's competitors have refreshed over its lifetime. The Malibu, Sonata and Optima are all new, and all in equally bad shape sales wise.

Bottom line, only companies that can move decent volume at decent margin in this space are Honda and Toyota. Ford can build cars that are as good (or better- Focus is better than the last Civic and all Corollas IMO) and it's not enough. At a certain point brand trumps all, even in the mainstream space

I think it depends on how you determine "better". The auto transmissions alone put the Fiesta & Focus by default towards the bottom since they're ticking time bombs and for that reason alone I've steered friends and family away from them. Yes the transmission is just one component but a big one and a car isn't any good if it can't move.

[MX793]

I feel like the difference in MSRP between an equally equipped Edge and Fusion is like $3-5K. But the actual transaction price difference is like $10K.

You flip cars.... if you could double or triple your profit on every flip for the same amount of work just by focusing on certain cars, why wouldn't you?

And what if, instead of migrating from a Fusion to an Edge, Fusion buyers go to their local Honda or Toyota store and pick up a CamCord instead?  That only benefits Ford if they are selling Fusions at a loss (they aren't).

[Lebowski]

And what if, instead of migrating from a Fusion to an Edge, Fusion buyers go to their local Honda or Toyota store and pick up a CamCord instead?  That only benefits Ford if they are selling Fusions at a loss (they aren't).

What makes you think they aren't?

[Klackamas]

Seems people won't pay $20K for a 4 door hatchback, but happily pay $25K for essentially the same vehicle with a bit of cladding and 1/2" taller shocks. Oh, I can get it with AWD? Here's another $5K! Take my money! With 72 months financing my monthly payment is the same as the lowly car! (at 60 months). SO MUCH WIN!

It's important you buy the hatchback for $30K. The profits will go to a very worthy cause, so do it for the greater good.

- Ministry of Good and Plenty

[12,000 RPM]

What makes you think they aren't?

Even if they aren't, I imagine margin is low enough that it's hurting their overall profitability.

And it's not just about the margin. The Fusion has lost 1/3 or ~100K sales in the last 2 years. I just realized the Focus has had negative sales growth every year since the Mk3 came out in 2012 (in the US). How bad does Ford have to let things get before you guys feel they would be justified in cancelling these cars and deploying those resources elsewhere?

[MX793]

Garbage transmissions, and associated Consumer Reports "avoid" ratings, have likely hurt the current Focus more than anything.

Fusion is an old model.  It received a very minor facelift for 2017.  That sales are declining should surprise no one.

[Lebowski]

Fusion is an old model.  It received a very minor facelift for 2017.  That sales are declining should surprise no one.

US car sales volumes have been declining for 30 years. It's not something as simple or fixable as where the fusion is in its refresh cycle. 

[MX793]

US car sales volumes have been declining for 30 years. It's not something as simple or fixable as where the fusion is in its refresh cycle. 

The age of the model reflects why it's particular sales have recently fallen off faster than the segment as a whole.  Weather vs climate...

[r0tor]

This makes no sense.... for the last 20 years, Ford has struggled with sedans and thrived on trucks/SUVs in the US. The only things that have changed are that those trucks/SUVs get livable fuel economy, and Ford is finally willing to make profit, rather than market share, a priority. Market presence is worthless if it comes at the expense of profit.

Ford succeeds in the truck market because virtually all of the competition is domestic and hence they can get away with lazy designs and questionable quality while charging a boatload.  That will eventually change.  Ford will eventually need to be competitive - assuming the truck market doesn't get destroyed.

The SUV market is already saturated with competition and will only get worse.  Unless they fix their real issue (not producing desirable vehicles) they will be selling SUVs with massive discounts to move them.

[Lebowski]

The age of the model reflects why it's particular sales have recently fallen off faster than the segment as a whole.  Weather vs climate...

If the overall LT secular trend is down, the segment is unprofitable, and redesigns require significant investment, why keep pouring capital into this segment?

[12,000 RPM]

There were several newer cars that fared worse from 2016 to 2017....  Sonata, Legacy, 6. Brand new Malibu was marginally better (-18% vs -21%). So a refresh would not save the Fusion.

I mean, every single mainstream midsizer was down in sales last year.

http://www.goodcarbadcar.net/2018/01/midsize-car-sales-america-december-2017-2017-year-end/

So we know a refresh won't work and the whole segment is facing a headwind in a growing auto market. What do you guys think Ford could do to turn these cars' sales around, profitably? There are stupid answers to this question, like "more brown diesel wagons!"

[12,000 RPM]

Ford succeeds in the truck market because virtually all of the competition is domestic and hence they can get away with lazy designs and questionable quality while charging a boatload.  That will eventually change.  Ford will eventually need to be competitive - assuming the truck market doesn't get destroyed.

I don't know much about trucks, but a 5,000lb brick that can tow like 8000lbs, return 20MPG and run a low 14 second quarter mile (not at the same time- yet ) is not a "lazy design". Nor is something that is recommended by CR of "questionable quality".

The SUV market is already saturated with competition and will only get worse.  Unless they fix their real issue (not producing desirable vehicles) they will be selling SUVs with massive discounts to move them.

Get worse how? Everyone already has an entry. More importantly Ford helped create the segment, and has built brand equity there with its continued presence. This shows in the sales and margins it has there.

As for "producing desirable vehicles"... the F150 has been the top selling vehicle in the country for years if not decades, with skyrocketing ATPs. And I'd hardly call the Focus/Fusion's competition "desirable". A mainstream Toyota is about as desirable as a washing machine. Desirability has nothing to do with success in the mainstream market.

[Lebowski]

Ford succeeds in the truck market because virtually all of the competition is domestic and hence they can get away with lazy designs and questionable quality while charging a boatload.  That will eventually change.  Ford will eventually need to be competitive - assuming the truck market doesn't get destroyed.

The SUV market is already saturated with competition and will only get worse.  Unless they fix their real issue (not producing desirable vehicles) they will be selling SUVs with massive discounts to move them.

Right, Toyota, Nissan, Honda aren't in the truck, SUV, or CUV markets where F is profitable.


Trucks, SUVs, and CUVs are more profitable than passenger cars across the board. They are growing (whereas cars are declining) on a total industry basis, not just Ford.

Not sure what your point or your solution is. F hasn't been able to consistently make money in cars for decades, that this is some kind of short term decision that will come back to haunt them is a position you have not successfully provided any supporting arguments for.

[Submariner]

I think it depends on how you determine "better". The auto transmissions alone put the Fiesta & Focus by default towards the bottom since they're ticking time bombs and for that reason alone I've steered friends and family away from them. Yes the transmission is just one component but a big one and a car isn't any good if it can't move.

Woah.  It's been a while.  How have you been?

[giant_mtb]

Who the heck is Hurricane Steve?  I have a buddy named Steve for whom that name would make perfect sense, but.