Ford Motor Company:

Ford Benefits from GM/Chrysler Bankruptcies

1

AutoPacific Survey Results Image.jpg
The Detroit Big Three soon will consist of the New General Motors, New Chrysler and Old Ford, or better… the New Old Ford. Ford has benefited from a major restructuring begun with the arrival of Alan Mulally in 2006. Like most other automakers today, their sales are way down and they are hemorrhaging cash at an alarming rate. But they seem to have a plan. They have a viable short term product plan, have aggressively rightsized their organization and have not taken federal bailout money and have not undergone bankruptcy, It’s a wonder that all sounds like good news.
A VehicleVoice Internet survey of over 900 respondents in the field from June 3 through June 8 asked several questions concerning Ford’s position in the market while General Motors and Chrysler are in bankruptcy…


Continue Reading

Top Safety Picks by Insurance Institute of Highway Safety

0

The Insurance Institute for Highway Safety has announced the winners of its 2009 Top Safety Picks. There are 72 winners in 2009; more than double in 2008 and more than 3 times as many as in 2007. Some key factors leading to winning results are better structure to protect from side impacts and increased application of electronic stability control which helps maintain control and minimize rollovers. Additionally, improved headrests are doing a better job protecting against whiplash.

tsp09_award.gif

IIHS works for auto insurers and publishes the results of its Top Safety Picks to help consumers select the safest cars and light trucks when they are in the market. AutoPacific’s research shows that safety features and feeling safe while driving are very important when a person selects their vehicle.
Ford Wins 16 Top Safety Picks – almost 25% of Those Awarded
A major result of the 2009 Top Picks was that Ford Motor Company (including Volvo) had 16 of the 72 Top Picks. Several years ago, after Ford acquired Volvo, Ford began adopting Volvo safety strategies in its designs. Several Ford vehicles are derived from the Volvo S80 platform – Lincoln MKS, Ford Taurus, Ford Taurus X, Mercury Sable, Ford Flex, Volvo S80. Using Volvo’s vaunted SIPS (Side Impact Protection System), Ford has been able to make its larger vehicles able to withstand significant blows from the side.
The Ford Fusion with ESC and Mercury Milan with ESC, Lincoln MKZ, Volvo C70, Ford Edge, Lincoln MKX, Volvo XC90, Ford Escape, Mercury Mariner, Ford F-150 also won IIHS Top Safety Picks for 2009.
Honda Comes In Second – Close Behind Ford
Coming in close behind Ford Motor Company products was another company that set an objective to become a safety leader several years ago. American Honda has Top Safety Picks for Acura RL, Acura TL, Acura TSX, Acura MDX, Acura RDX, Honda Accord 4-doors, Honda Civic 4-doors with ESC, Honda Fit, Honda Odyssey, Honda Pilot, Honda CRV, Honda Element and Honda Ridgeline. The Honda Fit is the first Economy (Mini) Car to achieve an IIHS Top Safety Pick.
• • • • •

The IIHS Press Release Is shown below the fold.


Continue Reading

Lincoln MKS – New Lincoln Flagship

0

AutoPacific and VehicleVoice just drove the all new Lincoln MKS in Washington DC and rural Virginia. We were the third of three waves of journalists and analysts to evaluate the MKS, but our wave had the added advantage of driving through a microburst of wind, thunder and lightning that tested the car’s systems from its all wheel drive, rain-sensing windshield wipers and latest generation SIRIUS Travel Link system. So the first two waves drove the cars in perfect weather and we got the best of it – a challenge.
Competes With Executive Luxury Products
The Lincoln MKS is a contemporary luxury car positioned against the Cadillac STS V6 and Lexus GS350. Other competitors Lincoln identifies are the Acura RL, Infiniti M35, and up-level Cadillac CTS. There was even mention of Nissan Maxima and Hyundai Genesis. The MKS is actually longer than the BMW 750Li and competes well in interior spaciousness even with the long wheelbase competition (BMW 750Li and Lexus LS460 L). Lincoln won’t have to apologize for the car being a “little Lincoln”… it is full sized.
Against its STS and GS competition, Lincoln has a good value story being base-priced thousands less and including gobs of standard equipment. In fact, loading up an MKS to the specs I would personally choose yields a price point of about $43,000 for the AWD version.

Lincoln MKS Nose VehicleVoice Blog.jpg

New Lincoln Design Cues Begin Appearing on MKS
Styling is not particularly head-turning, but Ford’s stylists were able to push the design envelope a bit further than when the MKS was first seen at auto shows about 18-months ago. Since then, Ford Design has developed a palette of Lincoln DNA design cues that were rushed into production on the MKS. The result is an MKS style that incorporates Lincoln’s new bow wave grille, simple bodyside sculpturing and a kickup over the rear wheels in the rear quarter panel. There is a large Lincoln star placed on the rear surface of the front fender – a cue we will be seeing on future Lincolns. The rear end has LED taillamps distinguished by hockeystick shaped backup lamps on the inboard surface. A cue we particularly like – borrowed from the BMW 750Li and Infiniti M are the fore-to-aft bright inserts in the roof panel. Nice touch. The MKS can be had with large 20-inch tires and wheels that really fill the wheel openings but don’t deteriorate ride quality.
Lincoln MKS F34 VehicleVoice Blog.jpg

Lincoln MKS R78 VehicleVoice Blog.jpg


Continue Reading

It's Official: Jaguar Land Rover Has Been Sold

0

Below the jump, you can read Tata‘s official statement on buying Jaguar and Land Rover, now Jaguar Land Rover, from Ford today. However odd it may seem for these illustrious British marques to be owned by an Indian conglomerate, Tata may well end up being an excellent caretaker.

Tata_JLR.jpg

At least initially, it seems that Tata Motors is looking to let the company continue with the product plans in place before the sale. Tata has ensured supply of needed engines and stampings through “long-term” agreements with Ford Motor Company and appointed David Smith the new Jaguar Land Rover CEO. Mr. Smith, who had been Jaguar Land Rover’s CFO, took on the role of acting CEO after Geoff Polites death in April. The appointment of a long-time Land Rover principal, holding twenty-five years with the SUV maker, indicates further support of the existing management staff.
As Tata gets more deeply involved, the business situation is bound to change. But the Indian company has patience, and seems to be ready to learn about the international business before making significant changes.


Continue Reading

Exhaust Note #9: Kerkorian is Back

0

Tracinda Corporation Buying Into Ford Motor Company
Kirk Kerkorian, the incredibly wealthy 90-year-old investor and businessman, has long been well known among auto-industry watchers. He was first involved with Chrysler, back in the days when Lee Iacocca was turning things around. Later, his takeover attempt also sparked the notion of merging the company with another, which ultimately led to the creation of DaimlerChrysler. There are few today, other some who retired well off the deal, who would say that was a merger that was beneficial for either company, equals or not.
After eventually getting out of the Chrysler business, Tracinda bought enough of General Motors to get a seat on the board. Company man Jerry York held that seat and pushed for a GM-Renault-Nissan tie-up. Bound by duty to stockholders to explore the option instead of dismissing it outright, Rick Wagoner and GM staff worked with Renault-Nissan for a few months to prove what we all seemed to know in the first place: A Renault-GM tie-up didn’t make much sense. Kerkorian’s Tracinda sold off its GM stake and went home. The end of that story, right?

FordOval_RGB.jpg

Well, yes and no. Whether by the “third time’s a charm” or “try, try again” schools of thought, Tracinda has been accumulating shares of Ford Motor Company since April 2, 2008, and offered today to buy more. And by more we mean enough to give Tracinda 5.6% of FoMoCo. But what does Tracinda really want? Does the company want take over a Detroit car company, no matter which? It does seem that Kerkorian is obsessed with making a major, direct impact on the automotive industry. His efforts so far have succeeded in shaking things up, often when it can be most disruptive, but not in improving the business overall.


Continue Reading

Year End 2007 – Auto Industry in the Rear View Mirror

0

2007 Rear View Mirror 1.jpg

A stream of consciousness look at the auto industry in 2007. Whew, what a year it was!!!!!!!
Not the Trauma We Expected, but 2007 was Tough
We began the 2007 thinking the year was going to tank into the mid-15,000,000 unit range. That didn’t happen and the industry struggled to just over 16,000,000 units. This reasonably good year was in the face of negative media coverage, a severe housing downturn, a subprime mortgage crisis, soaring gasoline prices, etc.
Saying 2007 at just over 16 million units was a good year will be criticized as nuts, but we have been conditioned since 2000 to think that 17 million is good. It wasn’t too many years ago that 15 million was good. So, 16 million ain’t too bad. Just not what we have become accustomed to. And, by accustomed to, I mean we have plant capacity for many more units. We have dealers in place to sell many more units. We have built our business models and breakeven points on 17 million units and not 16 million.
We began the year with turmoil. Ford was in turmoil and embarking on an aggressive restructuring program with a new CEO at the helm. There were rumors of bankruptcy hovering over Detroit. DaimlerChrysler AG announced that it would off-load its American Chrysler Group and rely on upscale Mercedes-Benz cars, commercial trucks and, of course, Maybach and smart.
Ford Oval Big Blog.jpg

Ford Struggles Through 2007
By year end, Ford is still with us and there are some bright spots in its lineup – Fusion, Edge, MKX, MKZ. The Five Hundred, Montego and Freestyle were freshened, got new engines and renamed Taurus, Sable, Taurus X. Well, the upgrades took, but sales did not and Taurus, et.al have languished on dealer lots. I did see a ton of them on Kauai along with a very high number of Dodge Calibers. So, we know that retail sales for the Ford large cars and Crossover are not doing too well. Ford has retained top spot in big truck sales with F-Series remaining the sales leader even with Silverado and Tundra coming on strong and the Dodge Ram pickup offered at fire sale prices. Ford unloaded Aston Martin and spent the year doing due diligence on off-loading Jaguar and Land Rover (probably to India’s Tata Motors). Ford will keep Volvo, however.
To help Ford with sales and marketing, Ford lured Jim Farley to the Company. Formerly Group Vice President of Toyota’s Lexus Division, Farley was a rising star in the Toyota ranks. A friend of the Ford family, Farley appears positioned to challenge Ford’s other young star – Mark Fields – as the heir apparent to Alan Mulally in four or five years.
Chrysler LLC Logo.jpg

Now, It’s Chrysler LLC
DaimlerChrysler gave Chrysler Group to Cerberus Capital Management retaining a 19.9% stake. Cerberus promptly named Bob Nardelli – formerly hard charging CEO of Home Depot and General Electric – as CEO of Chrysler LLC. Nardelli’s lack of specific auto industry experience was offset by Cerberus adding highly respected Toyota executive Jim Press as co-COO. Press is working his way through Chrysler’s activities using the revered Toyota Five Whys approach (a question asking method used to explore the cause/effect relationships underlying a particular problem. Ultimately, the goal of applying the 5 Whys method is to determine a root cause of a defect or problem). Five Whys, understandably, has Chrysler vets on edge. They now have to justify everything. Nardelli, Press and Tom LaSorda are facing soft sales, high inventories, sub-par interiors in many cars and an image gap. With $10 billion in loans, Chrysler LLC has some time to prove itself or position itself for a takeover or a parceling out of components (like Jeep, Dodge Truck, Minivans, etc). Oh, yeah, DaimlerChrysler became Daimler AG in October.
GM Brand Mark Small.jpg


General Motors Has Turned the Corner

General Motors appears to have turned the corner. GM has kept its head down during 2007 staying out of the feeding frenzy the media has directed at Ford and Chrysler. Not that there aren’t numerous stories written about GM, it’s just that there hasn’t been the bad news to whet the appetite of journalists.
GM’s products are improving now that the early efforts of Bob Lutz are being seen. While cars like the Saturn Aura and trucks like the Lambda Crossover SUVs and GMT900s have set the tone, Lutz’ real impact has been seen on the 2008 Cadillac CTS and 2008 Chevrolet Malibu. Both of these cars will serve to cement GM’s car lineup for years to come.


Continue Reading

Audi R8 – VehicleVoice Drives Audi’s Super Car

2

R8-1.jpg

Sonoma, California: Audi’s long awaited R8 has landed here in the States. This past week, VehicleVoice had the chance to review and drive the vehicle at Audi’s New Performance School at Infineon Raceway.
Purpose built to showcase new Audis to the press and host driving events for owners, the new facility at Infineon has the unmistakable Audi presence, with the proper applications of glass, steel, asphalt and, of course, aluminum. Both track and autocross courses were made available to the press for the day.


Continue Reading

Steve Wilhite Leaves Hyundai – Marketing Man on the Loose

2

Readers of VehicleVoice may not be intimately aware of the folks running the various car companies, but their comings and goings can make for great stories. The recent career of Steve Wilhite, until last Friday Chief Operating Officer of Hyundai Motor America, promises to be one of the more interesting.

Wilhite.jpg

Wilhite’s Career – Ford, Volkswagen, Apple, Nissan, Hyundai… NEXT?
Wilhite has been a well-regarded car marketer since he joined Volkswagen of America in the early ’90s and help turn the company around through innovative advertising campaigns. Of course, he picked up the ball after VW had stopped taking cars produced at their Puebla, Mexico assembly plant until quality was acceptable. At their lowest, Volkswagen sold less than 50,000 cars in one year.
Wilhite Credited with “Think Different”
Following VW, Wilhite joined Apple Computer as the chief marketer. Apple’s “Think Different” campaign came under Wilhites tenure and set the image of the Apple brand for the late ’90s and early ’00s. Apparently, working for Steve Jobs as a senior executive is not the easiest job in the world. Wilhite recounts stories of being summoned to Jobs’ home at oh-dark-thirty more than once to brainstorm Apple marketing issues.
Tokyo a Wrong Move
But the car industry beckoned again and after a brief interlude Wilhite joined Nissan North America as head of marketing and then moved to Tokyo as head of Nissan’s global marketing. Frustrating job. Great title, but no real power. Spouse hated Tokyo. Writing on the wall. Hyundai came along.

The Hyundai Year – August 2006 – September 2007

Wilhite joined Hyundai Motor America in August 2006 as their “current” Chief Operating Officer. Following the departure of Finbarr O’Neill the COO job at HMA had been a revolving door. In fact, Wilhite’s predecessor Bob Cosmai lasted a bit over a year. HMA missed his first year’s sales targets by less than 2,000 units and the second year by about 15,000. Didn’t meet his targets… assassinated.
Wilhite joined a company with extremely ambitious sales targets. A target of 1,000,000 units in the USA for 2010 was a one-time target – part of Hyundai’s Global Top Five strategy. Wilhite inherited a sales target of 555,000 units for the 2007 calendar year when he signed on. This was adjusted to 510,000 units as the reality of the 2007 calendar year became clearer. By the time he left, HMA was on track to sell a bit over 450,000 units. So, either the Koreans eliminated another top American, Wilhite got extremely frustrated with Korean management and not achieving goals, or Wilhite has a really good offer in the works from another car company.
Wilhite to Fill Ford’s Top Marketing Opening?
We’ll go with the other car company offer for the moment. Conjecture has it that Wilhite would be the perfect candidate for the top marketing job at Ford Motor Company. Ford is looking. In fact, General Motors may be looking for a replacement for their top marketing exec Mike Jackson who “left” earlier this year. Looks like Wilhite may have several juicy opportunities if he chooses to stay in the auto biz.
In any event, Hyundai has lost another top executive… an executive who understands the power of brand building and was putting plans in place to enhance the overall perception of Hyundai in the USA.


Continue Reading

From the Economist – Beauty on the Block – Jag and Land Rover

1

This article appeared today on The Economist website and provides their typically British spin on the automotive industry in Britain sometimes to the exclusion of others. Included here with VehicleVoice commentary.
Beauty on the Block
August 30th 2007
From The Economist print edition
A new car and six potential buyers signal hope for Jaguar
EMOTION is said to play a part in many car purchases, but it is less likely to be a factor when buying a car company. Even so, the reaction this week to the first pictures of Jaguar’s new XF saloon will have done nothing to still the beating hearts of the half-dozen or so likely bidders for Jaguar and Land Rover, the two British marques being auctioned together by their beleaguered owner, Ford.

Jag XF F34 in Motion.jpg

But who will buy it?
It would be hard to exaggerate the importance to Jaguar of the XF, which is certain to be one of the stars of the Frankfurt motor show in September. It represents a complete design departure from the frumpy “retro” look with which Jaguar has saddled its often well-engineered saloons for the last decade. If the XF’s swooping lines and elegantly modernist interior are a hit with younger customers who would never previously have thought of owning a Jaguar, then the firm, under new ownership, may have a future after all.
VehicleVoiceIn our story of August 28, the XF represents a potential saviour for Jaguar – a car that is coveted by buyers of mid-size luxury cars the world over. As we mentioned then, Ford may be getting out of Jaguar just as it turns the corner. Of course, the very conservatively styled, but excellent, XJ premium luxury entry needs to get an injection of XF DNA the next time it is freshened and that is years off.
Although Ford has refused to name the prospective buyers, they include Tata Motors (a division of Tata Group, an Indian conglomerate), probably another Indian car company, Mahindra & Mahindra, and at least four private-equity firms. These include Cerberus Capital Management (which relieved Daimler of Chrysler), One Equity Partners, Ripplewood Holdings, and Texas Pacific Group.
All the bidders are now deep into due diligence as they prepare to table non-binding offers at the end of September. As well as poring over the books, they are touring facilities and examining plans for future products. They are also competing in a beauty contest for the backing of potentially hostile unions, which fear for the jobs of 19,000 members employed in several British factories. Ford is publicly confident of concluding a sale by early next year at the latest. But reaching a sensible valuation of the two marques, which Ford says must be sold together because their operations have become so tightly integrated, is not proving easy.
VehicleVoice – Don’t forget… The Land Rover LR2 (Freelander II) and Volvo XC60 share a common platform. That’s about the limit of cross marque sharing among Jaguar/Land Rover and other Ford brands. Pulling away from Volvo would be much more problematic for Ford because of cross-platform sharing with Volvo and Ford’s big cars in the USA (Taurus/Sable/Taurus X) and the S60-V70-S60 plus sharing of the European Focus/Mazda3/Volvo C30-S40-V50.
Judging how far the XF will halt the slide in Jaguar’s fortunes—its sales have fallen by almost half from a peak of 130,000 a few years ago—is only one question among many. How long will the weak dollar eat into the sales and earnings of both makers? Is it necessary to have three factories and a separate design centre to build fewer than 270,000 cars a year? What will happen to Jaguar and Land Rover, which make relatively big and thirsty vehicles, if the European Commission goes ahead with its plan to impose upon car manufacturers an average CO2 emission target of 130g/km by 2012? And how will the onset of a global credit squeeze affect what private-equity groups can pay for a capital-intensive business with a time horizon of three to five years?
The answer to the last two questions may depend on the kind of deal that Ford is prepared to do. All the possible bidders seem likely to want something similar to that wrung from Daimler by Cerberus. The German firm not only agreed to hold on to a 20% equity stake in Chrysler, but also provided substantial financing. Any new owner will want to ensure that Ford retains an interest in the future of the business, in part because it may be possible to persuade the commission to count Jaguar and Land Rover as part of Ford’s bigger and more economical range for the purpose of measuring emissions.
As for Ford, its priority is just to get a respectable deal done. Alan Mulally, its chief executive, is adamant that running luxury brands has no part in the company’s future. He also concedes that the credit market’s tightening “absolutely is an issue”. Lovely though the XF may be, Mr Mulally wants someone else to be its proud owner as soon as possible.
VehicleVoice – All true, Economist. But where does that leave Volvo? The rumor mill continues to mention possible sale of Volvo as well, but Volvo is profitable and intimately linked with Ford in a prduct sense. The idea of Ford keeping an equity stake to convince the EU to let Ford’s volumes count against those of Jaguar and Land Rover in emissions regulations is probably absolutely necessary. After all, the present product decisions at Jaguar and Land Rover were made under that scenario – having Ford as a balancer for their worse CO2 emissions.


Continue Reading

Who Will Ford Sell Parts of PAG To?

2

This article appeared in the July 26th web-release by the British business magazine The Economist. VehicleVoice commentary is peppered throughout.
Ford: A costly distraction
July 26th 2007: From The Economist print edition
Ford is selling off its premium brands. Who will buy them?
Ford’s High Hopes for the Premier Automotive Group Never Materialized
WHEN Jacques Nasser, Ford’s boss in the late 1990s, bought two premium European car brands, he had high hopes for his new luxury-car division, which came to be known as the Premier Automotive Group (PAG). By 2005, the firm predicted, Aston Martin, Jaguar, Land Rover and Volvo would sell 1m cars a year, earn more than $1 billion annually and account for about one-third of Ford’s profits. But eight years on the PAG is consistently losing money and sells about one-third fewer cars than predicted—and Ford itself is haunted by the spectre of bankruptcy.
New Ford Regime Under Alan Mulally Puts PAG on the Block Piecemeal
After some initial hesitation Alan Mulally, the chief executive brought in from Boeing last September, decided to put bits of the PAG on the block. In March he sold Aston Martin for $848m, and in June he appointed three banks to field potential buyers for Land Rover and Jaguar. The bidding period ended on July 19th with an unexpectedly high number of potential suitors, thought to include Cerberus Capital Management (the private-equity group that bought Chrysler in May), TPG Capital, Ripplewood Holdings and One Equity Partners (a private-equity firm where Mr Nasser now works), along with India’s Tata Motors and the Mahindra Group.
Click here to find out more!
VehicleVoice Spin: How much of this is circuitous reporting by the international media? Ford has admitted that potential sale of Jaguar and Land Rover is on the horizon, but how accurate is the list of potential bidders The Economist cites? Wouldn’t it be interesting if Cerberus bought Jaguar and Land Rover to be the luxury marques for Chrysler Group?
Ah, Here Comes the Volvo Rumor Again…
Ford is also considering a sale of Volvo, a Swedish maker of premium cars, and the most valuable and profitable bit of the PAG. Last year Volvo is believed to have made a profit, though the PAG as a whole lost $2.3 billion. (Ford does not break out details of the division’s financial results.) But although selling Jaguar and Land Rover would make sense, it is less clear that the same is true of Volvo, says Jonathan Steinmetz, an analyst at Morgan Stanley, an investment bank. Volvo is more integrated into Ford than the two other brands, with several Ford and Volvo vehicles sharing chassis designs and parts. Volvo is also far bigger by units sold—it accounted for 7% of sales in 2006, compared with 3% for Land Rover and 1% for Jaguar—which helps to spread development costs.
Former Chairman of AMC Says Ford Should Unload All of PAG and Tend to Knitting
But Gerald Meyers, a former chairman of the American Motors Corporation, a carmaker bought by Chrysler, thinks Ford should sell all of the PAG and get what cash it can. Since Ford is in the middle of a multi-year turnaround plan, any distraction from rescuing its core American business is counterproductive, he argues. (In a sign that the plan might at last be working, Ford announced a surprise profit of $750m for the second quarter on July 26th.)
Now This One Doesn’t Make Much Sense
BMW of Germany is one possible bidder for Volvo. BMW says it is keeping its eyes open for takeover targets, though it has had its fingers burnt by acquisitions in the past. Volvo and BMW are compatible premium brands, says Marc-René Tonn, an analyst at MM Warburg, an investment bank in Hamburg. But they do not fit technically: Volvos rely on front-wheel drive, BMWs on rear-wheel drive. Renault would be a more logical buyer, says Thierry Huon at Exane, a brokerage in Paris. Renault needs a premium brand, having failed to build one itself. And the Renault and Volvo brands, with their common emphasis on safety, fit together well.
VehicleVoice Spin: BMW tried its hand with “The English Patient” – Rover and Land Rover – in the 1990s. BMW ended up selling Rover to an investment group for £10 and selling Land Rover to Ford for a couple billion dollars. Volvo cars are based on front wheel drive platforms, BMWs are rear wheel drive (with the exception of MINI). There isn’t much synergy here. Much different mindsets as well. This could well be The English Patient all over again if BMW is so anxious to acquire more brands.
Volvo Group Buys Back Volvo… Now That’s an Idea
Another possible buyer is Volvo Group, the lorry-making (heavy trucks, to Americans) parent firm that sold its car unit to Ford in 1999. This would reunite the two divisions, but there are no synergies between carmaking and lorry-making, which is why the cars were spun off. It is more likely that Renault will sell its 21% stake in Volvo Group to help finance its purchase of the carmaker.
Can Ford Recoup Its Investment in Money and Resources in the PAG Units?
Estimates of the proceeds from a sale of the PAG range from $8 billion to $16 billion. Ford could invest the money in its remaining brands—Ford, Lincoln, Mercury and Mazda—or in product development. But it would probably be wisest to restructure its health-care liabilities, which it is currently discussing with the United Auto Workers (UAW), the car industry’s main union. Mr Mulally is pressing the UAW to set up a union-managed trust that would enable Ford to take tens of billions of dollars of retiree health-care liabilities off its balance sheet. Such a trust would need to be funded up front—so cash from the sale of the PAG would come in handy.
VehicleVoice Spin: <Ford’s immediate headache is the 2007 UAW negotiations and indeed medical costs are a major part of the equation. Ford needs concessions to improve its profit picture and help guarantee those UAW workers their jobs. But, this is still the car business and Ford has fallen behind. Not as far behind as Chrysler, but General Motors has certainly taken the lead in product development of late. Ford needs to restructure not only the Company but also its product lineup. If getting rid of PAG – including Volvo – gets their attention back on the ball, so be it.
But think of these things… Many Ford middle managers now have positions with PAG brands either in Europe or headquartered in Irvine, California. Would they go back to the mother ship? Have they learned enough at PAG brands to be an asset to Ford? Would their departure hurt the PAG brands further? On the product sharing side, The Economist article rightly states that Volvo, Ford and Mazda are successfully sharing platforms. How could Volvo continue that in a cost-effective way if they were to be sold? The transfer pricing would be a bitch. Don’t forget either that the new Land Rover Freelander II/LR2 shares its architecture with the upcoming Volvo XC60. Wow, this is complicated.


Continue Reading

Follow VehicleVoice

RSS Feed   Facebook   Twitter

Membership

Join

Recent Winners

Sid P., Washington - $100
Ken G., Nevada - $100
Brad T., Wisconsin - $100
Tom M., Virginia - $100
Kathy F., New Jersey - $100
John M., Massachusetts - $100
Mike M., California - $100
Carol R., Texas - $100
James D., Georgia - $100
Martha B., New Jersey - $100
Kerry B., Pennsylvania - $100

What is VehicleVoice?

About Vehicle Voice