Not cool, Ford. Not cool.

[MontuckyFried]

The news is all over the internet right now, but here are a few articles for reference:
https://arstechnica.com/cars/2018/04...vs-and-trucks/
https://jalopnik.com/ford-will-phase...ica-1825544784
https://www.msn.com/en-us/money/comp...tjG?li=BBnb7Kz

First and foremost, I blame the median American consumer. Thanks to those jerks, our beloved manual transmissions are rapidly going extinct, SUVs, trucks, and crossovers have all but taken over the roads, and vehicles are quickly becoming just an extension of the smartphone, not the driver.

Let me just say that for the most part, I hate SUVs, and have really come to loathe the flood of crossovers. While I completely understand that they don't have near the MPG penalty they used to carry, and they drive far better than they used to, with very few exceptions I just cannot bring myself to appreciate them. They're just SOOOOO lame. Here I am in the market for a peppy little fun city car, and then I see this news. I was eyeing the Volvo C30 (extinct), maybe going back to a Mazda 3 hatch like I used to have (thankfully still around with a 6MT), or a Ford Focus or Fiesta ST (soon to be extinct). And then I see this news today. Ford was FINALLY starting to bring us some great smaller cars like they've had in Europe for ages. They tease us with the Focus RS and the spritely little Fiesta, but then they're like "Lol, nope! Here's a Ferd Efteenhundred instead. Maybe you'd prefer an Escape?"

I'm sure they're just caving to market demands right now and an MBA fueled team of financial executives says it makes sense from a quarterly/annual perspective, but I find this really short sighted and kind of infuriating. But then again, perhaps I'm just one of the few weirdos out there (along with you guys) that craves a 3rd pedal, good driving dynamics, and a car that actually fits in a standard parking spot. I don't care what the crossover/SUV/truck loving masses think they want for their commute; I always found a small car SO much better for zipping around rush hour traffic, shopping, and especially going downtown.

Something else I've noticed lately? A SERIOUS increase in jacked up (and spotless/shiny) bro-dozers..in the city. . Do we need $10/gallon gas to get things back in check or what? Common, people! Common, Ford!

[Skidog]

The news is all over the internet right now, but here are a few articles for reference:
https://arstechnica.com/cars/2018/04...vs-and-trucks/
https://jalopnik.com/ford-will-phase...ica-1825544784
https://www.msn.com/en-us/money/comp...tjG?li=BBnb7Kz

First and foremost, I blame the median American consumer. Thanks to those jerks, our beloved manual transmissions are rapidly going extinct, SUVs, trucks, and crossovers have all but taken over the roads, and vehicles are quickly becoming just an extension of the smartphone, not the driver.

Let me just say that for the most part, I hate SUVs, and have really come to loathe the flood of crossovers. While I completely understand that they don't have near the MPG penalty they used to carry, and they drive far better than they used to, with very few exceptions I just cannot bring myself to appreciate them. They're just SOOOOO lame. Here I am in the market for a peppy little fun city car, and then I see this news. I was eyeing the Volvo C30 (extinct), maybe going back to a Mazda 3 hatch like I used to have (thankfully still around with a 6MT), or a Ford Focus or Fiesta ST (soon to be extinct). And then I see this news today. Ford was FINALLY starting to bring us some great smaller cars like they've had in Europe for ages. They tease us with the Focus RS and the spritely little Fiesta, but then they're like "Lol, nope! Here's a Ferd Efteenhundred instead. Maybe you'd prefer an Escape?"

I'm sure they're just caving to market demands right now and an MBA fueled team of financial executives says it makes sense from a quarterly/annual perspective, but I find this really short sighted and kind of infuriating. But then again, perhaps I'm just one of the few weirdos out there (along with you guys) that craves a 3rd pedal, good driving dynamics, and a car that actually fits in a standard parking spot. I don't care what the crossover/SUV/truck loving masses think they want for their commute; I always found a small car SO much better for zipping around rush hour traffic, shopping, and especially going downtown.

Something else I've noticed lately? A SERIOUS increase in jacked up (and spotless/shiny) bro-dozers..in the city. . Do we need $10/gallon gas to get things back in check or what? Common, people! Common, Ford!

Agree like 1000000%. I do drive a truck, but am thinking of a focus st myself. Seems the car market goes in phases. Gas crisis in the 70s made everyone go small, now we go back again? I applauded Ford for the new designs on the focus, fusion, etc and now this shit..

Weird for sure.

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[Mazderati]

The economy is roaring, jobs abound, and fuel is relatively cheap. It is shortsighted but big trucks and SUVs are the new luxury vehicle and that's what people want right now. Plus the profit margins on trucks are hudge. The market will eventually reverse course and fuel economy will once again be prioritized until it isn't.

[El Chupacabra]

On one hand, if there's no market for sedans or hatchbacks, Ford's move makes sense. What else can they do - keep building cars that nobody wants to buy?

On the other hand, if gas prices spike to $5/gallon, and buyers seek out small fuel miser cars, Ford won't have anything those buyers want. A Mustang isn't going to work for a buyer who wants four doors to load kid seats.

It's a risky move. Ford must be in trouble if they're taking this chance. They failed to field a competitive minivan, killed off Mercury, and I can't see any compelling reason for Lincoln to exist.

FCA already sort of went down this path. Take a look at Chrysler's website and see what they have left to sell. I think it's down to the Pacifica minivan (which actually looks pretty nice), and an old 300. That's it. They're betting everything on Jeep and Ram trucks.

[reckless toboggan]

Something else I've noticed lately? A SERIOUS increase in jacked up (and spotless/shiny) bro-dozers..in the city. . Do we need $10/gallon gas to get things back in check or what? Common, people! Common, Ford!

We call them "road princesses".

[dunfree]

The economy is roaring, jobs abound, and fuel is relatively cheap. It is shortsighted but big trucks and SUVs are the new luxury vehicle and that's what people want right now. Plus the profit margins on trucks are hudge. The market will eventually reverse course and fuel economy will once again be prioritized until it isn't.

There's alot of that.

I also think that purchasers of SUVs/Trucks aren't going to be the early-adopters of autonomous cars/rideshare cars. Sedan owners will be, and ford's still working on those designs I believe.

[Danno]

On one hand, if there's no market for sedans or hatchbacks, Ford's move makes sense. What else can they do - keep building cars that nobody wants to buy?

On the other hand, if gas prices spike to $5/gallon, and buyers seek out small fuel miser cars, Ford won't have anything those buyers want. A Mustang isn't going to work for a buyer who wants four doors to load kid seats.

Agree. But not only will they not have the cars people want, they won't be able to produce them for years. They're betting on cheap gas and low MPG/environment standards, which seems really shortsighted. They'll be caught with their pants down by this move.

And this is coming from someone who hasn't owned a small car in over 20 years.

[The Tortoise]

wagons4life

On the one hand I think this will bite Ford in the ass. On the other hand, when was the last time you saw a Fusion on the road?

[Self Jupiter]

Check out Mini if you can stomach the maintenance costs.

[MontuckyFried]

On one hand, if there's no market for sedans or hatchbacks, Ford's move makes sense. What else can they do - keep building cars that nobody wants to buy?

True. I can see their reasoning from purely a business perspective, but...

On the other hand, if gas prices spike to $5/gallon, and buyers seek out small fuel miser cars, Ford won't have anything those buyers want. A Mustang isn't going to work for a buyer who wants four doors to load kid seats.

This will inevitably happen. Big gamble. They're saying they'll be pumping out electric/hybrid vehicles by 2021 (that's being WAY optimistic), but if gas prices spike from now to then, they're pretty well screwed. They're also basically abandoning an ENTIRE market segment...entry level buyers. With nothing but trucks/suvs/crossovers left, that prices out a ton of people. Sure, it might make sense at first glance to only sell your big moneymakers, but they just lost a TON of brand loyalty when those entry level buyers have to look elsewhere for a vehicle, and then stick with that brand when they inevitably trade up.

It was before my time, but I kind of like the OLD GM's reasoning behind the various brands. Kind of made sense back then. Start with a Chevy. Want something a bit sportier and making a bit more money? Here's Pontiac now. Now you're middle aged and moving on up to management? Buick. Now you've REALLY made it in life...Cadillac. Kind of a natural progression of the stereotypical 50's/60's family. Don't get me wrong. I can understand how having a half dozen brands all share the same parts bins is a prehistoric business model and wouldn't work today, but they built an empire of brand loyalty that no company could dream of today...which they've since lost.

I could totally understand Ford slimming down the lineup a bit, but axing ALL their regular cars except the Mustang? That I don't get. I see far too many Fusions on the road these days to think it's truly a failing platform. Sure, I'm willing to bet there are some highly skilled, highly paid, brilliant actuaries behind this, with all the mathematical formulas and stats to back it up, but it still seems beyond common sense to me.

[riser4]

Flown Over Rathe's and Dropped.

[iceman]

Have I driven a Ford...lately?

No.

But I can't really fault them for putting their efforts, such as they, are into vehicles that people actually seem to want to buy, for some reason.

[AdironRider]

I think it is pretty amazing that they can sell 15000 of these things a month, 180000 a year, and kill it off. That said, they were reportedly losing money on every one.

This is a margin play, stock is up. From a business standpoint it makes sense.

Crossovers are indeed pretty lame, but so is some boring Ford Taurus or Fusion. Also have you been in a Fiesta? It's designed for someone the size of a 12 year old.

The Focus active is going to get mid thirties MPG, the point of having a sedan, which for all intensive purposes is less practical, is pretty much non-existent at this point. People that buy actual cars are pretty much only buying performance variants these days.

[adrenalated]

Like a quiver-of-one ski, a crossover is just a series of compromises.... which is why I own both a lifted pickup truck and a small 3-pedal hatchback.

I see a shit-ton of Focuses on the road. I don't really see those buyers all going to crossovers. I think they're going to lose a lot of customers to Toyota/Hyundai/Kia/Chevy/etc.

[Skidog]

wagons4life

On the one hand I think this will bite Ford in the ass. On the other hand, when was the last time you saw a Fusion on the road?

My buddy has one and I have driven them as rentals, it's actually not a bad car. Mid sized, comfortable. Fits nicely between a focus/fiesta size and a crossover.

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[Sirshredalot]

There's alot of that.

I also think that purchasers of SUVs/Trucks aren't going to be the early-adopters of autonomous cars/rideshare cars. Sedan owners will be, and ford's still working on those designs I believe.

I think there are a couple things going on here, and this is informed guesswork on my part.

1. New car buyers are skewing older. Young people are more likely than ever to buy used. Today's yuppies are too busy servicing student loans and paying 2k+ in rent on their 50k per year salaries to want to throw down for a new Fiesta ST.

2. Old people are buying crossovers and light trucks as their grandpamobiles instead of the full-size sedans that their parents bought, for whatever reason

3. I do think the current new SUV purchasers will be slow to adopt self-driving cars, but that is because that demo is old and only getting older.

4. Ford should ask Cadillac how well a brand does when their strategy is to milk old people for high-margin crap.

[AdironRider]

Like a quiver-of-one ski, a crossover is just a series of compromises.... which is why I own both a lifted pickup truck and a small 3-pedal hatchback.

I see a shit-ton of Focuses on the road. I don't really see those buyers all going to crossovers. I think they're going to lose a lot of customers to Toyota/Hyundai/Kia/Chevy/etc.

And apparently they are going to make more money at the end of the day as a result. It seems if you are selling 100k plus of anything in a given year, and can't turn a profit, it would be a systems problem, not a sales problem, at least IMO. Thats a shit ton to sell of anything.

[Bunion 2020]

More commentary:

In 1963, the US launched what remains among the biggest trade barriers on its books: a 25% tariff on foreign trucks, in retaliation against European duties on American chickens.

Now, you might say, the effects of this infamous “Chicken Tax” have come home to roost.

Ford, the company that pioneered the planet’s first mass-market car, is going to stop making cars—mostly.

“Given declining consumer demand and product profitability, the company will not invest in next generations of traditional Ford sedans for North America,” Ford said in its earnings report (pdf) yesterday, April 25. It will instead concentrate “on products and markets where Ford can win.” That means trucks, SUVs, and crossovers (which is car-speak for “littler SUVs”). The iconic sports car Ford Mustang will also survive the cuts.

This isn’t exactly surprising. Americans really dig gas-thirsty chrome behemoths. They also happen to be much more profitable than passenger cars.

Ford is a case in point. In 2017, Ford sold four of the top 20 bestselling cars in the US. Only one—the Fusion, at #19—was a sedan.

Ford’s not the only one killing off its little cars. General Motors is winding down production of the Chevrolet Sonic, a passenger car, and may scrap the Chevy Impala, according to the Wall Street Journal (paywall). A few years back, Fiat Chrysler scrapped the Chrysler 2000 sedan and the Dodge Dart to concentrate on pickups and SUVs.

What’s more interesting is why trucks and SUVs are so vital to US automakers—and what that implies about Detroit’s competitiveness.

The Chicken Tax—the 25% tariff that president Lyndon Baines Johnson passed in 1963—was initially aimed at blocking a popular German export, Volkswagen’s iconic van (which may or may not be the Mystery Machine of Scooby-Doo fame).

It wasn’t supposed to be permanent. But it gave Detroit a competitive edge over foreign companies in producing trucks and vans. (By comparison, the US only charges a 2.5% import duty on regular foreign cars.) So the tariff stuck around.

To this day, the bestselling vehicles in America are all pickup trucks made by US automakers. Thanks to the Chicken Tax, they can charge US consumers more than they would if they were exposed to competition. And that boosts Detroit’s margins.

There’s a solid argument to be made that protectionism can help economies, nurturing domestic industries until they develop the capacity, technology, and know-how to compete globally. (US founding father Alexander Hamilton was one prominent champion of this idea.)

But that’s not what’s going on with the Chicken Tax. The cushy US truck oligopoly is an accident of 1960s diplomacy. It hasn’t helped Detroit thrive globally. Instead, it’s induced a default reliance on gas-guzzlers among the Big Three carmakers (Ford, GM, and Chrysler). That’s allowed their foreign competitors to dominate the fuel-efficient passenger car market.

The pitfalls of the Chicken Tax became alarmingly apparent in 2009. When oil prices spiked in the mid-2000s, demand for big trucks plummeted. To stay afloat, GM and Chrysler received high-profile taxpayer bailouts. (Ford also requested government funding.)

With yesterday’s announcement, Ford drives home the economic legacy of the Chicken Tax. The profits of pickup protectionism are allowing Ford to cede the market for small, fuel-efficient cars to foreign rivals. That might be a sound strategy while gas prices stay low, buoying truck demand. But there are signs that those prices are ticking up again.

https://www.msn.com/en-us/money/comp...UgT?li=BBnbfcN

[MontuckyFried]

It seems if you are selling 100k plus of anything in a given year, and can't turn a profit, it would be a systems problem, not a sales problem, at least IMO. Thats a shit ton to sell of anything.

Seriously! If 100K+ units wasn't enough, then low volume companies like Volvo or Mazda couldn't possibly exist.

[SumJongGuy]

The writing was on the all for this long before Trump Tantrums and Trade Wars. Autonomous vehicles taking over means a lot more standardized car models, far less variety, fewer units in service with them all working 24/7 serving humans and products instead of sitting idle in garages and driveways. That screams for cheap overseas production on every different variable.

[tuco]

On one hand, if there's no market for sedans or hatchbacks, Ford's move makes sense. What else can they do - keep building cars that nobody wants to buy?

On the other hand, if gas prices spike to $5/gallon, and buyers seek out small fuel miser cars, Ford won't have anything those buyers want. A Mustang isn't going to work for a buyer who wants four doors to load kid seats.

It's a risky move. Ford must be in trouble if they're taking this chance. They failed to field a competitive minivan, killed off Mercury, and I can't see any compelling reason for Lincoln to exist.

FCA already sort of went down this path. Take a look at Chrysler's website and see what they have left to sell. I think it's down to the Pacifica minivan (which actually looks pretty nice), and an old 300. That's it. They're betting everything on Jeep and Ram trucks.

If gas goes to $5 a G, buckle down for the next recession

[S_jenks]

When I read the articles I got the impression that they are dropping their current lineup in favor of pushing hard into electric vehicles, but really it seems to be a myopic attempt at boosting margins over the short term.

Yeah it's true that trucks will continue to be a huge seller for the foreseeable future, but they have to realize the significant trends in the urban/suburban markets, right? There absolutely is a ceiling for demand on trucks/SUV, and it can be argued that they've already pushed that ceiling way too high. If the market turns or gas prices shoot up again, they may be in financial trouble.

What Ford has done is both allow other car makers (foreign and domestic) to scoop up a larger market share in small vehicle sales, while doing nothing to carve themselves a bigger slice of the truck/SUV market.

[MultiVerse]

Ford also feels as though they made a bad bet with the aluminum F-150. When the truck was in development Ford expected fuel prices to rise but when fuel prices remained low Ford's F-150 material costs ended up leaving more money on the table than they would have liked. In other words, from a corporate culture standpoint it's possible the people who care/push for fuel efficiency i.e. sedans etc. may have lost their power when it comes to influencing internal decisions like these.

[Sirshredalot]

Ford also feels as though they made a bad bet with the aluminum F-150. When the truck was in development Ford expected fuel prices to rise but when fuel prices remained low Ford's F-150 material costs ended up leaving more money on the table than they would have liked. In other words, from a corporate culture standpoint it's possible the people who care/push for fuel efficiency i.e. sedans etc. may have lost their power when it comes to influencing internal decisions like these.

It feels strange to say that anyone at Ford has any regrets about the current generation F150. They sell a fuckton of them at pretty high margins.

[stuckathuntermtn]

The economy is roaring, jobs abound, and fuel is relatively cheap. It is shortsighted but big trucks and SUVs are the new luxury vehicle and that's what people want right now. Plus the profit margins on trucks are hudge. The market will eventually reverse course and fuel economy will once again be prioritized until it isn't.

Yup. Then we have another bailout when the bubble bursts. Fucking disgusting. This is why we should be upholding fleet emissions/mileage/safety requirements, not getting rid of them.


Ford's always been garbage, so it figures. Although, didn't they not really need a bailout like GM or Chrysler?
Get me a Japanese made or designed car any day.