Ford halts Melbourne Falcon assembly as demand drops off

[Ford_The_Win]

Originally Posted by Magna

but interior trim always get bumped and scratched especially in the cargo area it would be good to replace if it wasn't so expensive.

Yes but let's face facts, the cost of spare parts is not the reason people aren't buying Falcon. If I recall correctly Falcon is already one of, if not the cheapest cars to own in terms of spare parts and servicing.

[Magna]

Originally Posted by Ford_The_Win

Yes but let's face facts, the cost of spare parts is not the reason people aren't buying Falcon. If I recall correctly Falcon is already one of, if not the cheapest cars to own in terms of spare parts and servicing.

but it would help Ford with money from another revenue stream, and the parts suppliers. if ford arn't making cars wouldn't it be better to keep the flow of parts happening?

[RAREV8]

A bad thing happened....Ford are no longer competitive enough with their pricing as after an 8 year run of Falcons as company cars, G6's and Futura's mainly, our company has gone for a bog standard Aurion ATX.
Why? Of course the Falcon is a better car in almost every respect but at 27K each, the ATX won. I blame Ford for making me drive a Toyota.
If anyone knows how to get Ford to beat this price as well as the service costs, they will get their business back and I won't be looking for another job
BTW, I am not that one eyed but this Aurion wont tow my boat, hasn't got split rear seats and lacks boot room so is virtually useless outside my work environment.

[vztrt]

Originally Posted by RAREV8

A bad thing happened....Ford are no longer competitive enough with their pricing as after an 8 year run of Falcons as company cars, G6's and Futura's mainly, our company has gone for a bog standard Aurion ATX.
Why? Of course the Falcon is a better car in almost every respect but at 27K each, the ATX won. I blame Ford for making me drive a Toyota.

How hard have Toyota gone to push their cars now. Maybe the company is getting a good deal from them? I know my work is getting 5 new Commodores soon and mainly have had Falcons and Commodores. Only Toyota is a Hilux.

[prydey]

Originally Posted by RAREV8

Of course the Falcon is a better car in almost every respect but at 27K each, the ATX won.

how much money are toyota making on that sale? no point selling cars for no profit.

[DanielXR8]

Originally Posted by Ford_The_Win

Or they could just build cars properly that don't need new parts all the time?
Ford have burned a lot of people over the years by letting con artists run their dealerships and letting dodgy cars leave the factory. The pillocks in head office still think it's 1986 and Ford is everyone's default choice.

Exactly and even now, there is no signs from Ford Australia management that they get that.

If nothing else the drop in Falcon sales, gives them the perfect reason to get rid of a lot of the deadwood in their dealer network and rewrite the franchise terms for future dealers.

[Road_Warrior]

Look, the future for the Falcon - if there is one - is as a niche performance and luxury product. As a niche product it will probably only sell in the numbers it is now. Ecoboost and LPI can take care of fleet stuff but will it be a case of too little too late?

[irish2]

Originally Posted by Road_Warrior

Look, the future for the Falcon - if there is one - is as a niche performance and luxury product. As a niche product it will probably only sell in the numbers it is now. Ecoboost and LPI can take care of fleet stuff but will it be a case of too little too late?

Hence the reason that Mually's 'One Ford' is the only way forward. In this global market I see neither Ford Aus or Holden surviving. Holden produced 57,000 cars last year. They have stated that they need 105,000 to be viable. Cruze is expected to sell about 30,000. That still leaves 15,000-20,000 shortfall in production for GMH. Ford Aus made a profit last year on ~50,000 vehicles.

[prydey]

Originally Posted by irish2

Ford Aus made a profit last year on ~50,000 vehicles.

that doesn't necessarily mean the locally produced stuff made money. it may just mean they made enough money from the imports to cover it.

[jpd80]

Originally Posted by prydey

that doesn't necessarily mean the locally produced stuff made money. it may just mean they made enough money from the imports to cover it.

2005 to 2009 Holden lost $574 million

2005 to 2008 Ford lost $240 million

Looks like all those Holden Exports and extra local sales have been losing money for years.


One thing for sure, this will force Ford Australia to act, with declining Falcon sales
in the first two months of 2011, Ford is actually up 1% in sales thanks to the nice
up tick in imported Ford sales, it's as though the market suddenly switched over
from Falcon/Territory to to Fiesta, Focus, Mondeo, old Escape and Ranger.

Maybe the market is trying to tell Ford something very obvious, it's time to move on....

[Brazen]

Originally Posted by jpd80

2005 to 2009 Holden lost $574 million

2005 to 2008 Ford lost $240 million

Looks like all those Holden Exports and extra local sales have been losing money for years.

How can that be? Ford lost $274million in one year alone.

If god forbid Ford should fail....

Holden and Toyota could survive, like Skoda does by itself in its country. I suspect Holden would make a Rav4, Forrester competitor off the Cruze platform and sell 1100 units a month to high profit private customers and eventually be the Asian Pacific hub for Volt production, whilst still continuing with 4000 Commodores, 3500 Cruze and 900 Utes a month, plus exports (they would probably pick up some Falcon sales).

Toyota would introduce local Kluger production which is easily built on the Camry production line in Altona, it will take over global RHD Japanese production when that stops in 2014 and use that to steal local Territory sales, could probably do 2000 a month plus exports on top of Camry and Aurion.


Ford aint going anywhere though as Ford Au is vital for the region and too valuable to throw away, heaven help any government which would let it fail on their watch!!

I would be sleeping a lot easier if Focus was being built here, thats the ticket for future vehicle production in this country. Bloody cheap to build and big profit margins as people downsize to frugal, luxurious small cars.

[Road_Warrior]

Originally Posted by irish2

Hence the reason that Mually's 'One Ford' is the only way forward. In this global market I see neither Ford Aus or Holden surviving. Holden produced 57,000 cars last year. They have stated that they need 105,000 to be viable. Cruze is expected to sell about 30,000. That still leaves 15,000-20,000 shortfall in production for GMH. Ford Aus made a profit last year on ~50,000 vehicles.

The big issue for Holden going forward is the same platforms being made overseas. We already know the Cruze is made in Korea, Russia, the US and I think somewhere in Eastern Europe, and CKD versions of the WM Statesman are made in China and South Korea - if the global (or even local) economy goes sour again, why would GM continue to support high-cost manufacturing of an identical platform that is made in low(er) cost countries? Same goes for Toyota and the Camry. At least the Falcon and Territory have the uniqueness in the Ford world so that it is not readily replaceable - yet.

Originally Posted by jpd80

It looks like the market has given up on Falcon but no one really knows if it's temporary or permanent, that's the scary part...

We're not going to know until Ecoboost comes on line and LPG comes back. What I think is more scary is that Ford have probably already made their decisions and all the good stuff coming later this year will be in vain...happy to be proven wrong though.

[bobthebilda]

Originally Posted by irish2

Hence the reason that Mually's 'One Ford' is the only way forward. In this global market I see neither Ford Aus or Holden surviving. Holden produced 57,000 cars last year. They have stated that they need 105,000 to be viable. Cruze is expected to sell about 30,000. That still leaves 15,000-20,000 shortfall in production for GMH. Ford Aus made a profit last year on ~50,000 vehicles.

I dont beleive Ford OZ made a profit last year (at least they havent said so). The last profit figure Ford released was in about May last year, and that was for the year 2009. From memory in 2009, they made approx $13 million in profit, on sales of about 100,000 cars. That works out to be about $130 for each Ford car sold for the year. Theres was no indication from Ford that said the $13 million was made from local manufacturing, imported cars, or from spare parts.

IMO, Its quite clear, profits would be greater for them if they abandoned local manufacturing and resorted to full importer (Mitsy still have a healthy market share after abandoning local manufacturing), and its just a matter of slowly letting things die to defray some of the flack that goes with killing a local.

[SteveJH]

That was $13 million for the 09-10 Financial year, so July 2009-June 2010 i believe.

[bobthebilda]

Originally Posted by SteveJH

That was $13 million for the 09-10 Financial year, so July 2009-June 2010 i believe.

The result was released in early may 2010 (as per article), so couldnt be as per a financial year. The article does specifically refer to 2009 calender year.

http://theage.drive.com.au/motor-new...0506-uem3.html

[stevz]

Originally Posted by irish2

Ford Aus made a profit last year on ~50,000 vehicles.

They made a profit of what, $12 million? This is pocket change for a company the size of Ford. When you consider the actual return on investment it makes things look like a complete waste of time. Besides, how do we know that local production was actually profitable? For example they could have made a $100m loss which was then offset by a $112m profit on the imported range? Too many armchair experts here who make statements as if they were board members of Ford Australia, when in reality they have no clue what they're talking about.

[Joe5619]

Originally Posted by stevz

They made a profit of what, $12 million? This is pocket change for a company the size of Ford. When you consider the actual return on investment it makes things look like a complete waste of time.

Even if Ford AUST where making 12 or even 20% profit, it would still be pocket change for Ford... Any Australian branch of a global company makes pocket change!!

[mik]

Originally Posted by Joe5619

Even if Ford AUST where making 12 or even 20% profit, it would still be pocket change for Ford... Any Australian branch of a global company makes pocket change!!

12 or 20 % is better than not makeing a profit.

[bobthebilda]

Originally Posted by Joe5619

Even if Ford AUST where making 12 or even 20% profit, it would still be pocket change for Ford... Any Australian branch of a global company makes pocket change!!

See, now your going where most games of chinese whispers go. You have changed $12 million to 12%. No one knows how much money Ford has invested in australia, so it would be impossible to convert anything into percentages.

An auditors report a couple of years ago, reported that Holden actually had net assets of minus $200 million. Obviously if they keep losing money, then its not a going concern, and the government or head office will need to put up more money to keep it going. Ford havent released any figures to reveal how many assets they have in OZ. If its under $200 million, then it might be argued that $13 million profit a year is giving them an ok return. But then again, it could be argued that if they pack up and left, then writing off $200 million aint a big loss in the big scheme of things.

[DanielXR8]

Originally Posted by Road_Warrior

Look, the future for the Falcon - if there is one - is as a niche performance and luxury product. As a niche product it will probably only sell in the numbers it is now. Ecoboost and LPI can take care of fleet stuff but will it be a case of too little too late?

Which means it needs an export base for the numbers to add up.

Hopefully the Mustang/Falcon stories prove true.

[Road_Warrior]

Originally Posted by DanielXR8

Which means it needs an export base for the numbers to add up.

This could be a role for the Ecoboost version in places like Singapore, Thailand (FTA), Malaysia, the UK etc that are very emissions sensitive places to register and own a car.

[Brazen]

Originally Posted by Road_Warrior

This could be a role for the Ecoboost version in places like Singapore, Thailand (FTA), Malaysia, the UK etc that are very emissions sensitive places to register and own a car.

Also some countries have a tax based on engine capacity, so the 2 litre EcoBoost would do well. I will contiunue to be very critical of the EcoBoost plan in lieu of a diesel Falcon program, but if exports were dependent on the Ecoboost in this current generation - then I'l gladly eat my hat.

[SteveJH]

Possibly a topic for a new thread, but do we know how much has actually been spent on developing FG Falcon and SX Territory as of now?

I mean...

Falcon:
FG 1 = $ x million
FG 2 = $ x million
Miami = $ 40 million
Ecoboost = $ x million
Duratec V6 (cancelled) = $ x million
Euro 4 = $ x million

Territory:
SX (including diesel) = $ x million

If we could work out exactly how much was spent on all this. It would be quite easy to work out how much ford would need to make per car to:
a. Break even
b. make a greater then 12% ROI over the life of the E8 platform

Also, does anyone know if FPV/Prodrive have looked into selling Ford Badged FPV's through Ford UK and Ford South Africa? Sales would presumably only be the GS and GT given that the I6 is much more of an orphan.

[Brazen]

Originally Posted by SteveJH

Possibly a topic for a new thread, but do we know how much has actually been spent on developing FG Falcon and SX Territory as of now?

I mean...

Falcon:
FG 1 = $ x million
FG 2 = $ x million
Miami = $ 40 million
Ecoboost = $ x million
Duratec V6 (cancelled) = $ x million
Euro 4 = $ x million

Territory:
SX (including diesel) = $ x million

If we could work out exactly how much was spent on all this. It would be quite easy to work out how much ford would need to make per car to:
a. Break even
b. make a greater then 12% ROI over the life of the E8 platform

Also, does anyone know if FPV/Prodrive have looked into selling Ford Badged FPV's through Ford UK and Ford South Africa? Sales would presumably only be the GS and GT given that the I6 is much more of an orphan.

I like where your coming from, although one thing I hated in manufacturing management accounting was the allocation of some resources. Ie. If we developed a product we would always allocate the engineers, buildings, various costs and resources time at an hourly rate to the development, even though we would have to pay for the engineers and leases and taxes and rates and electricity and deprecitation whether they were working or not!!! I always thought this type of accounting hindered development proposals.

So when Holden says it costs a billion to develop the VE, in reality it probably cost them a lot less as all the staff, buildings, projects, taxes, rates would have to be paid regardless of the VE - its just that the expense can be allocated when the development starts.

[jpd80]

IIRC,

FG I was around 700 million but the government threw in like $130 million
FG II /SZ Territory are approx $230 million both all up (includes DTCI, Ecoboost and Eco LPI.
Falcon Update for emissions, engine cost $21 million but Government threw in $13 million.


We did this exercise a few years ago and it worked out to around $4,000 a car over the product cycle.
The best you could hope for with an imported car is $3,000/car reduction but given the cost of freight,
local development costs and Ford pocketing the rest, I doubt you'd see too much difference.

[b0son]

Originally Posted by DanielXR8

Which means it needs an export base for the numbers to add up.

Hopefully the Mustang/Falcon stories prove true.

At best, we'll design it.

Are Ford US importing chassis for any of their cars? I cant see Ford US doing it if the volumes are at all significant.

[jpd80]

It looks like the market has given up on Falcon but no one really
knows if it's temporary or permanent, that's the scary part...

[WOTDAH]

Don't know what has taken the media so long. Ford have been running 3 days a week since the beginning of Feb

[csv8]

Hindsight is wonderful!! but FG2, Ecoboost and LPG should have been out a year ago. Advertising should ramp up a notch or too. No more mr nice guy. Really hit the hybrids with the better economy ad etc..or its farewell Falcon hello Taurus

[Dr Smith]

Originally Posted by csv8

Hindsight is wonderful!! but FG2, Ecoboost and LPG should have been out a year ago. Advertising should ramp up a notch or too. No more mr nice guy. Really hit the hybrids with the better economy ad etc..or its farewell Falcon hello Taurus

I agree.

The problem is many things have changed to cause delays in some of these. Eg Tdi Terry was canned when Gorman took over and perol turbo brought out, tdi was due back around '06 (?), V6 was R&D's to replace local I6 meaning lilpg development was halted on I6 and not started yet on V6, then MB joins and V6 dropped, Geelong engine given a reprieve from closure and Falcon goes back to I6. Thus LiLPG program is restarted and now way behing original schedule plus some technical issues surfaced causing delay. Then Ford US makes an edict that ecoboost 4cyl must be used in all variants across the globe so Falcon program is announced when local Focus production is canned. And if I got that all right it's a mess of a situation at best. I didn't even mention wagon or lwb variants also being killed off.

I'm very fortunate to own and drive the best product Ford Australia has ever built in this country. The men and women who designed it did so on a budget that would cause laughter in a German car company as they joke and say "you do mean thats the powertrain budget only for 4 cyl models of our 5 engine range ... The problem is not enough Australians even consider it when shopping. Ford Aust doesn't have the latent loyalty of Holden and never will so just building the better car doesn't work. Hopefully the new Terry changes the "fuel guzzler image" which will filter down to Falcon. The new advertising bill-boards are specifically targetting this and as we know perception is difficult to break unless you go on the front foot and shout it out until you cause headaches. It's time to release the moths from the corporate wallet and spend big on marketing...for the whole range, regularly and consistantly....

From the moment my father brought home a brand new XW Falcon 500 wagon until when I suprised my wife when I brought home a G6ET (she expected a G6E) I've had Ford blood in my veins. It will be my preferred brand of choice regardless of who I know that works there (it does help though ) and maybe this is the shock-treatment that was needed.