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Saturday, January 21, 2006

First GM, Now Ford

Monday Ford is going to release it's restructuring plan, which is another blow to the US auto industry after GM announcing 30,000 job cuts in the next two years.

Ford lost about $950 million last quarter in the North American market, so anyone who thinks that restructuring is a bad idea needs to learn math. You can't bleed like that for long in a division and stick around. The odd thing is Ford isn't going broke like GM, Ford is actually going to show a $2 billion profit for it's last fiscal year based on it's world wide market and finance division.

What that points out is that unlike GM, Ford's biggest problem isn't legacy costs of it's pension programs and other worker expenses. They are part of the problem, but not nearly to the extent of GM. Ford's problem is really more market driven. Other than the Mustang and F-150 trucks they don't make much that folks want.

The Taurus sold like crazy for a lot of years. It spent many as either the number 1 or 2 selling passenger car in the US. While it is still on the market it hasn't been updated in a while and sales show that. The 500, the car that is supposed to replace it looks like the mid-70's boxes that every US car maker was producing, and is selling horribly.

The new Fusion has bland, at best styling that looks like a early 90's Honda Prelude from the front, and I'm guessing it's pretty easy to get one.

To illustrate how little excitement Ford is generating, they've lost more than 25% of their market share in the last 6 years. Dropping from 24% to just over 17% in that period.

Here's my suggestion to Bill Ford, about whom as one researcher said; "One can reasonably conclude that Bill Ford does not know how to build cars that people want to buy. On his watch, Ford will have redone his entire line and failed to accomplish success."; fire the design team, every last one of them! And Bill, keep your fingers out of the design world, too.

Ford's international program has revived Jaguar, and made Mazda's that folks like to look at and buy. Even Volvo has come out of the old box style they were famous for, and added some curves. Clean house in Michigan, and import some of the talent that has made the overseas divisions more successful and design something that I say "WOW" over.

Ford's world wide business is sound and making money, they need to bring some of that know how to the US division, before it's too late.

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6Comments:

Blogger shoprat said...

I drive a Ford Taurus and I need to replace it soon. It's been a good car though.

11:48 AM  
Blogger Crazy Politico said...

My mother in law had one for a number of years, and other than the pain of trying to "unadjust" their self adjusting disc brakes it wasn't a bad car at all.

The 500 is just so friggin' bland that it makes me want to puke.

11:59 AM  
Blogger Assorted Babble by Suzie said...

"Before it is too late" YOU said it.

My son drives a F-150 and you're right about that model and mustang...saw something on that. I remember when these numbers came out.

You must have also flipped over to the LA Auto Show too! (smiling)

I like my Beemer!! No Ford or GM for me.

11:49 PM  
Blogger Crazy Politico said...

suzie, I miss my 325i, but it got impractical as my son got bigger. And, at the time I couldn't afford a 5 series. If I could, it would be no more Fords or Chevy's for me either.

11:32 AM  
Blogger James B. said...

I am looking forward to buying the new Shelby GT 500, just to help Ford out, if the wife will let me of course...

1:18 PM  
Blogger Peakah said...

I'm bummed that they quit making Excursions... I have an '03 and Love it. With the family my size it's perfect... and yeah, chows on Gas like there's no tomorrow! Even so it's been the best vehicle I've ever owned but that's not saying a whole lot... (my other truck is a little Ford Ranger!)

1:27 PM  

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