Ford News: Ford Hopes To Sooth Dealers This Week

[William Maley 952]

Since becoming the CEO of Ford, Jim Hackett, and his management staff has had a difficult time of convincing folks about the ambitious restructuring plan that will see the lineup become more dependent on crossover and trucks, and job cuts. One group that has been quite worried about the plan are dealers.

"There's been a lot less exposure to senior management. There's just not enough information flowing down to dealers about where the company's headed," said Jack Madden, owner of Jack Madden Ford to Automotive News.

Ford is hoping to ease dealers later this week at the company's national dealer meeting in Las Vegas. Aside from seeing a number of new products, including the next-generation Escape and Explorer, Hackett and his team will be taking questions from dealers about the future direction of the company. 

"It's the right medicine at the right time," Rhett Ricart, CEO of Ricart Automotive Group in Groveport, Ohio.

"I think it will be a huge jolt for dealers' attitudes."

Dealers aren't the only group who are wanting more information. Ford's 70,000 salaried workers around the world have been told that the $11 billion restructuring plan will include job cuts, but not providing any specifics on numbers or how or when the cuts will take place. The cuts were announced in a video message sent to employees.

"In Ford's history, we have streamlined organizations but we rarely removed work, causing each team member to have to do more with less," Hackett said in the video, according to a transcript Ford provided to AN. Employees were told the upcoming changes would be made using "a cascading process that will involve many of you" and that they will work to eliminate "low-value" tasks. 

"While redesigning the organization is important and it's necessary work, it's not going to be easy. But it is fundamental to us becoming the business we need to be," said Hackett.

Ford say the message wasn't about job cuts and "said employees have appreciated the way it is handling the news." But AN reports that some employees became confused with the message being provided. Some experts say giving employees information about impending job cuts early on allows for more preparation and gives more time to look for another job. But some point out the way Ford announced the move could actually damage morale. 

"In an absence of any information, it's stressful. People are going to be looking for more direction from the company," explained Carol Olsby, a human-resources consultant and author.

Source: Automotive News (Subscription Required)

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[dfelt 5,004 5 Vehicles]

I have to agree with the stress it puts on people, Ford does not seem to have a clear plan to get out to their employees yet. Maybe if they are going to cover details at the dealership meeting, it would have also been the week to roll out a better message to the rank n file than just a vague video email.

[A Horse With No Name 3,444]

8 minutes ago, dfelt said:

I have to agree with the stress it puts on people, Ford does not seem to have a clear plan to get out to their employees yet. Maybe if they are going to cover details at the dealership meeting, it would have also been the week to roll out a better message to the rank n file than just a vague video email.

It's always a bad idea when you have to ahve products from 50 years ago to park behind you when you are talking about your corporate image and ideas being relevant.

Hopefully Chaos continues at Ford...but I really think they are going to pull it together.  I actually see a fairly bright future for Ford.  Focusing on their core business, their dominance in Trucks, the SUV lineup, the new Navigator and the Aviator, Transit...Mustang...they will be just fine.

A bright future!

Everywhere but my driveway that is...

[riviera74 1,153]

When was the last time a Ford Fusion outsold a Malibu or a Camry or Accord?  When did the Taurus outsell an Avalon or an Impala?

I think Hackett sees the writing on the wall and must change Ford or be buried alongside Mercury.

[balthazar 7,639 3 Vehicles]

^ If the business case for going forward with a model / line is ONLY being #1 in sales or 'gettng buried'... MAN is consumer choice going to tighten up!!

[frogger 576]

18 minutes ago, riviera74 said:

When was the last time a Ford Fusion outsold a Malibu or a Camry or Accord?  When did the Taurus outsell an Avalon or an Impala?

I think by the time it hit its second generation the Fusion has always ans still outsells the Malibu.  They trail the usual Camry/Accord/Altima.

 

 

 

[A Horse With No Name 3,444]

2 hours ago, frogger said:

I think by the time it hit its second generation the Fusion has always ans still outsells the Malibu.  They trail the usual Camry/Accord/Altima.

 

 

 

But they are not making much of a margin at the end of the day or they would still be selling it.

Also...Toyota and Honda brought out fresh new designs while Ford let the fusion rot on the vine.

[ocnblu 2,484 6 Vehicles]

*Soothe

Seems like things are pretty bad over there.  The misinterpreted announcement about cars going away really stirred the pot I guess.

[A Horse With No Name 3,444]

3 hours ago, ocnblu said:

*Soothe

Seems like things are pretty bad over there.  The misinterpreted announcement about cars going away really stirred the pot I guess.

Actually enjoying the Chaos myself. Still...I think the decision to stop building most of those cars in the United States is entirely sane and rational. 

[Robert Hall 5,455 4 Vehicles]

10 hours ago, A Horse With No Name said:

But they are not making much of a margin at the end of the day or they would still be selling it.

Also...Toyota and Honda brought out fresh new designs while Ford let the fusion rot on the vine.

Yes, Toyota and Honda still know how to build competitive cars in the US, while Ford has it's collective head up it's arse with it's truck obsession.  When the truck and SUV market eventually comes crashing down, they are going to be f*cked. 

[balthazar 7,639 3 Vehicles]

On the other hand, Ford still knows how to build SUVs, CUVs and trucks, and toyoyo/honda has their collective heads up their arses with their car obsessions. When the car market eventually comes crashing dow— whooops!!

[A Horse With No Name 3,444]

5 minutes ago, balthazar said:

On the other hand, Ford still knows how to build SUVs, CUVs and trucks, and toyoyo/honda has their collective heads up their arses with their car obsessions. When the car market eventually comes crashing dow— whooops!!

I actually like the F series the Mustang...and really don't mind some of the SUV lineup. Ford is really winning some respect from me of all people for focusing on the core business and doing it right.

I think Ford is poised to do well during the next financial downturn. People are NOT going to stop buying trucks for construction, farming, and personal use, the Mustang is an Icon...and lots of people will buy an SUV regardless of economics.

Ford will look GOOD in about 3 years with this decision.

Plus the F series has a hell of a lot higher margin than a Civic.  And more owner loyalty as well.

[balthazar 7,639 3 Vehicles]

^ Good points.
Recently I saw segment numbers from the '09-ish oil spike and 'trucks' saw a 17% higher contraction than 'cars' (don't know where CUVs were slotted) - obviously considerable, but I would think far less than many people might have guessed. I read plenty of assurances that 'trucks are dead' back then.

[ccap41 3,526 3 Vehicles]

13 hours ago, riviera74 said:

When was the last time a Ford Fusion outsold a Malibu or a Camry or Accord?  When did the Taurus outsell an Avalon or an Impala?

I think Hackett sees the writing on the wall and must change Ford or be buried alongside Mercury.

The Fusion has outsold the Malibu for the entire current gen Fusion. I don't think it has ever touched the Accord or Camry though. It's been a solid 3rd place for awhile. 

Small sample

2015 Malibu: 194,854

2015 Fusion: 300,170

2016 Malibu: 227,881

2016 Fusion: 265,840

2017 Malibu: 185,857

Through Sept. 2018

2018 Malibu: 107,458

2018 Fusion: 124,964

Source: Goodcarbadcar.com

 

11 hours ago, A Horse With No Name said:

But they are not making much of a margin at the end of the day or they would still be selling it.

I have a feeling it was always fairly tight margins and now that car sales have plummeted(see above comment) there just isn't much money to be had there with sales around and under 200k units compared to 300k units. 

They also fixed their ridiculous cusomizable-ness that had to have costs through the roof compared to the Accord and Camry which only have a handful trims and not many options per trim. 

[A Horse With No Name 3,444]

10 minutes ago, ccap41 said:

 have a feeling it was always fairly tight margins and now that car sales have plummeted(see above comment) there just isn't much money to be had there with sales around and under 200k units compared to 300k units. 

They also fixed their ridiculous cusomizable-ness that had to have costs through the roof compared to the Accord and Camry which only have a handful trims and not many options per trim. 

This is exactly why I say the business plan makes sense going forward.

 

Edited October 16, 2018 by A Horse With No Name
spelling

[regfootball 1,084]

where exactly do they see those 200,000 - 300,000 units getting picked up in the rest of their lineup?

A lot of Fusion sales are stuff like Fusion "S" which of course sells because it is low price (and low profit).  But to even think they will replace all of that volume (or, all of that profit, even in lesser volume of higher priced models) seems a bit absurd since a lot of dealerships need the unit volume and transaction count as much as any cash flow.

I mean now do you just sell more and more base level Edges?  Because if you take away the Fusion, not everyone is going want an Escape.  And they won't stomach the sometimes 10k jump from a sedan to a crossover that easily.

I think a serious auto market bubble is arriving in the next couple years.  50,000 dollar MSRP Blazers  and 65,000 dollar Sierras and such can only mean bad things.  The market and credit won't support this continued escalation much longer.

And really, at some point, people WILL lose interest in pony cars.  Between CAFE and culture, even the Mustang will get phased out of civility.

Edited October 16, 2018 by regfootball

[balthazar 7,639 3 Vehicles]

8 minutes ago, regfootball said:

where exactly do they see those 200,000 - 300,000 units getting picked up in the rest of their lineup?

Where are you getting that Ford is saying/expecting to shift their car customers to CUVs/SUVs?

[dfelt 5,004 5 Vehicles]

12 minutes ago, regfootball said:

where exactly do they see those 200,000 - 300,000 units getting picked up in the rest of their lineup?

A lot of Fusion sales are stuff like Fusion "S" which of course sells because it is low price (and low profit).  But to even think they will replace all of that volume (or, all of that profit, even in lesser volume of higher priced models) seems a bit absurd since a lot of dealerships need the unit volume and transaction count as much as any cash flow.

I mean now do you just sell more and more base level Edges?  Because if you take away the Fusion, not everyone is going want an Escape.  And they won't stomach the sometimes 10k jump from a sedan to a crossover that easily.

I think a serious auto market bubble is arriving in the next couple years.  50,000 dollar MSRP Blazers  and 65,000 dollar Sierras and such can only mean bad things.  The market and credit won't support this continued escalation much longer.

And really, at some point, people WILL lose interest in pony cars.  Between CAFE and culture, even the Mustang will get phased out of civility.

They could be deciding to blow off the low end entry level buyer of an auto, aka car and focus on those that have money and will pay for high end trucks / suv / cuvs.

[regfootball 1,084]

23 minutes ago, balthazar said:

Where are you getting that Ford is saying/expecting to shift their car customers to CUVs/SUVs?

Ford is not saying that, but the dealer owners will want to know how Ford plans to shift that sales units and volume.

[balthazar 7,639 3 Vehicles]

In a rising truck/SUV market: SELL MOAR TRUCKS!
If Ford applies it's 'F-Series' template to the other truck lines, IE: more variants than any other line in the USDM, sales will naturally increase.

[Robert Hall 5,455 4 Vehicles]

Well, they have the Bronco, new Explorer, mini-Bronco, and presumably the Ranger Raptor coming.  They could also add the existing Ranger-based Everest to have a truck-based midsize SUV.  

Maybe they could also expand and create new body style variations like a extra-extra length 6dr Expedition and Navigator (with 4 row seating for big families), an integrated pickup version of the Expedition and Navigator (ala Avalanche),  a 6dr 3 row F150 SuperMaxCrew. 

Edited October 17, 2018 by Cubical-aka-Moltar

[A Horse With No Name 3,444]

I don't know if those additional variations would add much.

[regfootball 1,084]

^^^^^^

[daves87rs 1,091]

On 10/15/2018 at 3:22 PM, A Horse With No Name said:

It's always a bad idea when you have to ahve products from 50 years ago to park behind you when you are talking about your corporate image and ideas being relevant.

Hopefully Chaos continues at Ford...but I really think they are going to pull it together.  I actually see a fairly bright future for Ford.  Focusing on their core business, their dominance in Trucks, the SUV lineup, the new Navigator and the Aviator, Transit...Mustang...they will be just fine.

A bright future!

Everywhere but my driveway that is...

I wish I could see it sad rosy as you....but then again I live under 20 miles to Ford headquarters....

They are not in a good spot now....and already two of their good engineers are out the door just this week. Brain drain is going to be a major concern as good car people look for safer waters with another auto company..I have a few friends deep in the Ford system, I am almost sure one is leaving after 20 years with the company.

I get the Feeling new products are not going to be as exciting just based on them watching nickels and dimes now...similar to a certain auto company a decade ago....

 

I hope for the best for Ford, but I see some dark times ahead.....

[A Horse With No Name 3,444]

5 hours ago, daves87rs said:

I wish I could see it sad rosy as you....but then again I live under 20 miles to Ford headquarters....

They are not in a good spot now....and already two of their good engineers are out the door just this week. Brain drain is going to be a major concern as good car people look for safer waters with another auto company..I have a few friends deep in the Ford system, I am almost sure one is leaving after 20 years with the company.

I get the Feeling new products are not going to be as exciting just based on them watching nickels and dimes now...similar to a certain auto company a decade ago....

 

I hope for the best for Ford, but I see some dark times ahead.....

And I really don't mind seeing them face them...and even fail in the face of them.