Ford's Thursday announcement

[argatoga]

http://jalopnik.com/399180/one-ford-...nt-cheat-sheet

As you already know, Ford dropped a double dose of news on us this morning. First, they lost $8.7 billion during the second quarter of this year. Second, they've officially revealed "One Ford," their global product realignment plan to bring to the United States much of their European lineup that's considered by many to be top-notch. With some seriously long press releases to wade through and items like "North America Long-Lived Assets" to explain, we figured you could use a hand in figuring out what this all means. So, we've put together a quick walk-through of what was said and our explanation — in patented Jalopnik Snap Judgment style — below the jump for all you people out there who just want to be "in the know."

Press Release #1: Ford's 2nd Quarter Earnings
What Ford Says: Ford reported a net loss of $8.7 billion.
Jalopnik Snap Judgment: $8.7 billion sure sounds like a lot of money. Well, that's because it is a lot of money — $3.88 per share, to be precise. It's actually the company's worst quarterly results ever. Especially given the company made a net profit of $750 million, or 31 cents per share, during the second quarter of last year.

But the real important numbers are how much cash they have on hand and how much revenues were. Second quarter revenue was only $38.6 billion, down $5.6 billion from the same quarter a year ago. And cash on hand? $26.6 billion now versus $28.7 billion at the end of March, 2008.

What Ford Says: It's not all bad news. Ford posted profits of $582 million in Ford Europe and $388 million in Ford South America.
Jalopnik Snap Judgment: Yes, this is true. Very good, Ford. But it's hard to get excited abut $960 million in profits when you've just dropped over $8 billion throughout the rest of the organization.

What Ford Says: Ford's claiming $1 billion in cost savings, including over $600 million in Ford North America and claims to be on track with reducing annual costs by $5 billion by the end of 2008 compared with expense outlays in 2005.
Jalopnik Snap Judgment: Yes, both very good things. It remains to be seen how much of those annual cost reductions are due to decreases in production and actual cost reductions. However, we do know quite a few personnel reductions have taken place over in Dearborn over the past few months, with more targeted buyouts offered to reduce salary-related costs by 15% in North American operations.

What Ford Says: $8 billion of the $8.7 billion loss are from "pre-tax special charges."
Jalopnik Snap Judgment: So this is where things get a little confusing. Some $516 million of the losses are the type of losses normally seen as items that can be written off as losses on a pre-tax non-ongoing basis — these would be items like the costs associated with cutting personnel, plant sales or reducing the number of dealers. But then there's the line item of "North America Long-Lived Assets" for $5.3 billion dollars. We'd never seen a line item like that on a list of pre-tax items, but we finally figured it out. We're interpreting it as Ford writing off the losses they'll take on the factory equipment they'll need to junk now that they'll be using those factories to build small cars. We'd even expect they'll need to take another cash hit in the next quarter to pay for that new machinery.

And that brings us to...

Press Release #2: Ford's Small Car Euro Offensive, Manufacturing Restructuring
What Ford Says: Ford is bringing six small vehicles to North America from the company's acclaimed European lineup.
Jalopnik Snap Judgment: Ford's finally answering U.S. auto enthusiasts prayers, and bringing their highly-regarded European lineup to the United States. We know we're getting from Europe the following vehicles:

1.) European Ford Fiesta - Four-Door
2.) European Ford Fiesta - Five-Door
3.) European Ford Focus - Four-Door
4.) European Ford Focus - Five-Door
5.) New 2010 Mercury Small Car
6.) New 2010 European Small "whitespace" vehicle

By the way, "whitespace" means a place where a vehicle does not currently fulfill a need. Like a three-wheeled MPV. Or, you know, a two-door six-seater.

We do also want to note that it doesn't appear that there will be a two-door Focus coming stateside. We guess that means we won't be getting the RS here. Sad. Still, we'd prefer the stylings of the four-door and five-door Euro Focus over — well — over just about any design Ford North America's put out in small cars in years.

What Ford Says: "Ford will convert three existing North American truck and SUV plants for small car production, with the first conversion beginning this December...The moves are in addition to Ford's announcements in May and June that it is reducing its North American production plans for large trucks and SUVs for the remainder of 2008, as well as increasing production of smaller cars and crossovers."
Jalopnik Snap Judgment: To accomplish this and build some of these new Euro vehicles here in North America, Ford will be making the following manufacturing plant changes. We want to emphasize Ford claims these will be flexible manufacturing changes — to ensure they're able to shift production when and if necessary:

* Michigan Truck Plant in Wayne, Mich.,
Currently Builds: Ford Expedition, Lincoln Navigator (to move to Kentucky Truck Plant early next year)
Will Build: Small cars derived from Ford's global C-car platform
Conversion Begins: December, 2008
Production Begins: 2010

* Cuautitlan Assembly Plant in Mexico
Currently Builds: F-Series pickups
Will Build: Ford Fiesta
Conversion Begins: ???
Production Begins: Early 2010

* Louisville (Ky.) Assembly Plant
Currently Builds: Ford Explorer mid-size SUV
Will Build: small vehicles from Ford's global C-car platform
Conversion Begins: ???
Production Begins: 2011

* Twin Cities (Minn.) Assembly Plant - was scheduled to close in 2009, but remain open to continue production of the Ford Ranger through 2011 to meet consumer demand.

* Kansas City Assembly Plant this year will add a third crew to its small utility line for the Ford Escape, Escape Hybrid and Mercury Mariner and Mariner Hybrid. (*Previously announced)

What Ford Says: "The company also confirmed Ford, Lincoln and Mercury will remain in its North American brand portfolio."
Jalopnik Snap Judgment: Looks like the Mercury brand will still be around — rumors of its demise appear to be greatly exaggerated. If the NYT is right, they'll be getting the brunt of the new Euro-designed small cars coming stateside.

What Ford Says: The Ford, Lincoln, Mercury line will be almost completely upgraded by the end of 2010.
Jalopnik Snap Judgment: Here's what they're talking about:

* 2009 Ford F-150, on sale in late fall

* 2010 Ford Fusion, Mercury Milan, Lincoln MKZ sedans, on sale in early 2009, Ford says Fusion's and Milan's four-cylinder fuel economy expected to top Honda Accord and Toyota Camry

* 2010 Ford Fusion Hybrid and Mercury Milan Hybrid, beginning production late this year and on sale in early 2009 - Ford claims fuel economy expected to top the Toyota Camry hybrid

* New Ford Mustang - coupe, convertible, glass-roof and every other variant model you can think of - in early 2009

* New Ford Taurus sedan - with EcoBoost engine - in mid-2009

* New Lincoln seven-passenger crossover - with EcoBoost engine - in mid-2009

* Next-generation Ford Explorer - with unibody construction, EcoBoost, six-speed, weight savings and improved aerodynamics for up to 25 percent better fuel economy, did we mention EcoBoost? - in 2010

[Cobol74]

At last someone has actually turned the tiller on the supertanker that is Ford, now we wait for any form of movement. ...

I think that this is mostly sound business sense, forced upon them but sound never the less. GM must respond again me thinks - Japanese brands be scared, be very scared, the giant awakes.

[prizrak]

I'm liking all the ecoboost stuff that we'll be getting. Is anyone else rooting for the big 2.5 to get their act together and return to profitability?

[C53A_4G63T]

For the love of god. All they need to do is take the Euro models, paste it in 3DS Max, and hit "mirror". Then save, print and WALK AWAY.

[American TG Man]

A whole bunch of Euro-designed cars coming to the US. As much as I am happy for this, I'm wondering if the UAW is going to sabotage their assembly due to their being un-American, and how badly?

/Fuck the UAW

[Cobol74]

Do they want jobs or not? Simple really.

[RUU-CHAMA]

Originally Posted by Cobol74

Do they want jobs or not? Simple really.

At one time I would say yes, now I'm not so sure, given some of their decisions.

[starfox07]

Will it be the current fiesta, or the new model coming out?

I'd be happy with either one, and I feel they would be a hit here.

[argatoga]

Originally Posted by starfox07

Will it be the current fiesta, or the new model coming out?

The new one. Ford is syncing up their next gen models globally. So the upcoming Fiesta, Focus, and Fusion/Mondeo will be the same for the most part on both sides of the water.

[tigger]

Originally Posted by Cobol74

Do they want jobs or not? Simple really.

It's not like they can be fired. Not easily anyway. I don't care much for Fords, (I guess I do drive one though ), but if the UAW half asses the builds on these European models I'll be pissed. I'm sure that some of those guys will be upset that they went from building great big 'mericun pickups to ... Fiestas.

[Cold Fussion]

Are they going to be proper focus's or a bastardised version again?

[argatoga]

Originally Posted by Cold Fussion

Are they going to be proper focus's or a bastardised version again?

It will probably be like the second generation North American Escort (Fifth gen Europe I think), were it was identical for the most part.

[Seasonone]

IMO they are 10 years too late for me to give them a chance, Ford along with GM and Daimler are the last places I would stop by when looking for a new car. Their cars just feel cheap, you can tell they lazily install parts from the lowest bidder, my moms Malibu feels just like a Hyundai... a Hyundai with a $5,000 markup. And the Malibu is the same price as my grandpas accord... and wow, it's like night and day.


It's a step in the right direction seeing as how the compensation SUV is dying fast but IMO build quality and parts used are more important than more small cars. Plus all the Fiesta is going to be is a poorly made yaris or fit. I'll still take the Japanese equivalent

[chaos386]

Should be interesting to see how this pans out. Rising gas prices have meant Americans are looking more favorably at cars the size most Europeans and Asians have been driving, which makes it easier to sell the same car in all markets, but there's the problem with the UAW as mentioned above.

Originally Posted by C53A_4G63T

For the love of god. All they need to do is take the Euro models, paste it in 3DS Max, and hit "mirror". Then save, print and WALK AWAY.

I don't think Americans would want to buy RHD cars.

[Cold Fussion]

Originally Posted by chaos386

Should be interesting to see how this pans out. Rising gas prices have meant Americans are looking more favorably at cars the size most Europeans and Asians have been driving, which makes it easier to sell the same car in all markets, but there's the problem with the UAW as mentioned above.



I don't think Americans would want to buy RHD cars.

Only the UK drives on the wrong side.

[MacGuffin]

Originally Posted by Seasonone

IMO they are 10 years too late for me to give them a chance, Ford along with GM and Daimler are the last places I would stop by when looking for a new car. Their cars just feel cheap, you can tell they lazily install parts from the lowest bidder, my moms Malibu feels just like a Hyundai... a Hyundai with a $5,000 markup. And the Malibu is the same price as my grandpas accord... and wow, it's like night and day.


It's a step in the right direction seeing as how the compensation SUV is dying fast but IMO build quality and parts used are more important than more small cars. Plus all the Fiesta is going to be is a poorly made yaris or fit. I'll still take the Japanese equivalent

Well, first of all, the European models of Ford and GM (Opel/Vauxhall) are very competitive high quality vehicles. They are mainly developed in Germany. All they have to do, is selling 1:1 copies in the USA without "americanizing" them. If they should mess that up, too, then there is clearly no hope at all anymore for the American motor industry.

It is true that bringing them on the U.S. market could be too late but it still is the right thing to do - actually the only thing to do in order to save their existence as independent car makers in my opinion.

Second I don't understand why you brought Daimler in. Neither are they in trouble, nor do they currently have quality problems. And they are not an American car maker.

You probably meant Chrysler. Maybe you didn't notice but Daimler sold Chrysler quite a while ago.

I was never convinced the takeover of Chrysler in the late 1990's would work out for both Daimler-Benz and Chrysler and in the end they had to realize that the attempt to create a "World Corporation", which can make cars of European quality standard in both Europe and the USA had failed completely and was nothing but a money-eating monster, which brought the Mercedes-Benz brand in trouble, too.
For years the company's focus was too much on bringing Chrysler into shape, which resulted in quality problems for Mercedes-Benz. Thus it cost Mercedes a lot of reputation with its traditional customers and because they shipped over their best engineers to help Chrysler to get on their feet, they lost their technological edge to BMW and Audi, which are now both on eye level with Mercedes.

So the whole thing was a complete disaster, similar to the BMW-takeover of Rover, and cost them dearly. However, Chrysler was able to bring a few models, that were attractive enough to be sold in moderate numbers here in Europe. Who knows? With more time and money maybe they would have succeeded.

But time and money are always the problem. Especially in the current economical situation.

Originally Posted by Cold Fussion

Only the UK drives on the wrong side.

Ummm.... no.

Japan does, too. So does Australia. And probably a few countries more.

[chaos386]

Originally Posted by Cold Fussion

Only the UK drives on the wrong side.

That was kinda my point. If you "mirror" the Euro Fords, most of which are LHD since Ford of Europe is a German company, you'd end up with RHD cars.

[Cold Fussion]

Originally Posted by MacGuffin

Japan does, too. So does Australia. And probably a few countries more.

I meant in europe

[edkwon]

Originally Posted by C53A_4G63T

For the love of god. All they need to do is take the Euro models, paste it in 3DS Max, and hit "mirror". Then save, print and WALK AWAY.

you said Euro and you really meant UK. Remember mainland Europe is still LHD :p

[MacGuffin]

Originally Posted by chaos386

That was kinda my point. If you "mirror" the Euro Fords, most of which are LHD since Ford of Europe is a German company, you'd end up with RHD cars.

Well, it's split between Britain and Germany. Britain develops the Fiesta and the commercial vehicles, while Germany develops the Focus and the Mondeo. The Production of the cars is spread all over Europe.

Be careful with the English Wikipedia entry about Ford, though. It lacks some soberness at times and seems suspiciously cheerful and praising. Wikipedia is your friend but not all friends are 100 % trustworthy

Sentences like this are hardly tolerable: "Ford Europe has broken new ground with a number of relatively futuristic car launches over the last 50 years."

I mean, yeah... they looked futuristic from outside but still had or have 50 year old technology inside