Ford Posts Full Year Profit

[Fordman1]

Originally Posted by phillyc

That is right. Total output was 55,000 in 2009 AFAIK. Approximate split was 31,000 Falcons. 14,000 Utes & 10,000 Territory.

I think a target of 60-65,000 is achievable in 2010. My projection would be 35,000 Falcons, 12,000 Utes & 15,000 Territory.

My tip is 58,000 and no more than 60,000

[jpd80]

Originally Posted by phillyc

That is right. Total output was 55,000 in 2009 AFAIK. Approximate split was 31,000 Falcons. 14,000 Utes & 10,000 Territory.

I think a target of 60-65,000 is achievable in 2010. My projection would be 35,000 Falcons, 12,000 Utes & 15,000 Territory.

I think that sounds like a fair assumption and the introduction of Ecoboost I-4 in 2011
could spell a nice lift in buyers seeking something other than a mid sized fridge....


I got this off the Ford media site, pity FoA is lumped into all of Asia, would be nice to see actual figures...

Asia Pacific Africa: For the fourth quarter, Ford Asia Pacific Africa reported a pre-tax operating profit
of $19 million, compared with a loss of $208 million a year ago.

The improvement reflects primarily favorable net pricing, China joint venture profits and structural cost
reductions. Fourth quarter revenue was $1.6 billion, up from $1.4 billion a year ago.
Link.....

Since FoA's $274 million loss in 2008 resulted in a $208 million loss for FAPSA then,
Asia without FoA made a profit of $62 million.

I'm wondering whether FoA made another big loss in 2009 that was canceled out
by Asia increasing revenue by a further $200 million over 2008?

[phillyc]

Originally Posted by Ohio XB

The Fiesta hits the US market about April and the new Focus in August-September. I believe the Focus will be a game changer for Ford. It has front end styling that Americans do NOT expect from Ford, and it looks pretty trendy.


Steve

Yeah, I certainly think that Focus could be a game changer. Didn't realise it would be launched this year. Thought it was 12mths away. Happy to hear it is!

Wonder how Fiesta will go. Coming into the summer months with the usual rising 'gas' price should be a good time to launch. Seems to be some hype for it too.

[jpd80]

Originally Posted by Ohio XB

The Fiesta hits the US market about April and the new Focus in August-September. I believe the Focus will be a game changer for Ford. It has front end styling that Americans do NOT expect from Ford, and it looks pretty trendy.


Steve

Steve, Focus is a 2012 model, not 2011 so I doubt you will see it this year.
That was all the commotion at Detroit, that people would have to wait a year for the new Focus.

[4Vman]

Originally Posted by phillyc

That is right. Total output was 55,000 in 2009 AFAIK. Approximate split was 31,000 Falcons. 14,000 Utes & 10,000 Territory.

I think a target of 60-65,000 is achievable in 2010. My projection would be 35,000 Falcons, 12,000 Utes & 15,000 Territory.

To increase output by an extra 10000 units will take considerable thinking and planning to avoid costly overtime cost burdons and potential quality issues.... it isnt as simple as turning the line up or working more hours....

[Fordman1]

Originally Posted by 4Vman

To increase output by an extra 10000 units will take considerable thinking and planning to avoid costly overtime cost burdons and potential quality issues.... it isnt as simple as turning the line up or working more hours....

Thats about 15 %... won't happen...

Small steps, small steps....

[4Vman]

Originally Posted by Barraxr8

Thats about 15 %... won't happen...

Small steps, small steps....

Exactly... a 15% increase in output would be very difficult to mange in such a short period of time...
Long term steady sustainable growth is better than "boom bust"...

[jpd80]

I heard that Ford was looking at increasing line speed, that might give a cushion for immediate delivery,
Ford would be tickled pink having to work Saturdays to keep up with demand...
Maybe overtime for now is the best solution to cover guaranteed sales...

[4Vman]

Originally Posted by jpd80

I heard that Ford was looking at increasing line speed, that might give a cushion for immediate delivery,
Ford would be tickled pink having to work Saturdays to keep up with demand...
Maybe overtime for now is the best solution to cover guaranteed sales...

As long as its a short term interum measureas part of sustainable growth and allows them to quickly move to standard production rates....
Overtime costs can quickly erode any profit the extra sales bring.....

[phillyc]

Forgive me for being an optimist! I never assumed it would be easy to increase the line rate. I've discussed this with a few on here before.

Burela has talked about raising the line rate sometime early this year. Dependent on the economic conditions, possible affect of the pull-forward by the 50% tax etc.

Last year had some down days earlier in the year. Prior to April 2009 IIRC. (When GMH were discounting Commodores to $28990 driveaway). Can someone confirm number of days?! Add in a couple of days that were lost, then maybe 1500 additional units could be made on that basis.

So to reach 60,000 would only require an additional 3,000 units. What does that work out to be? 12 overtime shifts. All that presuming no increase in line rate.

I do believe it is feasible on the factory front. Suppliers? Not so sure. But most i'm sure would welcome the extra output.

The big question is, if that extra output can be profitably absorbed. Particularly, as the 2010 forecast is to be 940,000 which is just 1-2% more than last year.

I'm sure Burela is working on that equation!

[Fordman1]

Originally Posted by jpd80

I heard that Ford was looking at increasing line speed, that might give a cushion for immediate delivery,
Ford would be tickled pink having to work Saturdays to keep up with demand...
Maybe overtime for now is the best solution to cover guaranteed sales...

1. The assembly plant doesn't have any scheduled (overtime) atm,

2, There won't be a line speed increase this year.

IF the demand is there it'll be done on weekends.... with OT.

I think there is still a concern about the incentives being finished (business buyers - tax wise), so FoA will be conservative with production schedules to avoid excess inventory..

[phillyc]

Originally Posted by jpd80

I heard that Ford was looking at increasing line speed, that might give a cushion for immediate delivery,
Ford would be tickled pink having to work Saturdays to keep up with demand...
Maybe overtime for now is the best solution to cover guaranteed sales...

Yes, this is what i heard. You posted as i was typing.

[phillyc]

Originally Posted by Barraxr8

1. The assembly plant doesn't have any scheduled (overtime) atm,

2, There won't be a line speed increase this year.

IF the demand is there it'll be done on weekends.... with OT.

I think there is still a concern about the incentives being finished (business buyers - tax wise), so FoA will be conservative with production schedules to avoid excess inventory..

Thanks Barraxr8! What happened to the talk of line rate increases? Is it just Burela being conservative? Figured the incentive hangover might be playing on his mind.

[Fordman1]

Originally Posted by phillyc

Thanks Barraxr8! What happened to the talk of line rate increases? Is it just Burela being conservative? Figured the incentive hangover might be playing on his mind.

Phil if Marin said that, he's hedging his bets and playing the media game. 'Line speed' may just mean building more cars on average, rather than 're jigging' the assembly plant.

Line speed increases (ie: rebalances ) are very expensive, and after you've done them you're locked in. If you need to reduce again, you either:

Have downdays or lay people off.

There are plenty of Saturdays in the year if extra production is required. If they can build an extra 10 or so cars a day with Mid week OT and some smart practices, they'll try that too.

If the production team at the assembly plant can improve their First time through, the daily rate may improve also.

[phillyc]

Originally Posted by Barraxr8

Phil if Marin said that, he's hedging his bets and playing the media game. 'Line speed' may just mean building more cars on average, rather than 're jigging' the assembly plant.

Line speed increases (ie: rebalances ) are very expensive, and after you've done them you're locked in. If you need to reduce again, you either:

Have downdays or lay people off.

There are plenty of Saturdays in the year if extra production is required. If they can build an extra 10 or so cars a day with Mid week OT and some smart practices, they'll try that too.

If the production team at the assembly plant can improve their First time through, the daily rate may improve also.

This is what I was getting at with increasing production by say 3,000 this year, would only be what 12 days of overtime? The lack of down days this year (hopefully!) would add another 1,500 vehicles. Suddenly, production is now 60,000pa.

I believe there will be some substitution between Coyote & I6T, but overall incremental / conquest sales gains. I think it may even have been you last year talking about the demand for I6T being huge = working long hours which in turn delaying some sales. Burela was saying regularly how many months in advance G6ET was sold out for too. Although if FPV are to assemble the V8, then i'm not sure how many they could build.

Just my thoughts. Putting them out there.

Again, the main thing is to do build and sell profitably.

[Falc'man]

Good news. Expected.

A lot of the dollars, lets not forget, were spent bringing out all-new cars at a time when very few were spending - and GM/Chrysler waiting for the doll cheque, stopping R&D on just about everything.

In effect these "losses" Ford had were in fact expenditures necessary that have put Ford in a superior position having superior products, when, as it turns out, the competition is still picking up the pieces.

Like I said, it was expected.

[jpd80]

Maybe I misread the Marin Burela quote from before Christmas where he said,
“We don’t have enough Territorys out there, we can’t meet demand.”

Barraxr8, your take on using Saturdays makes perfect sense for flexibility
without increasing line speed, if more expensive vehicles are built on those days
then perhaps the overtime costs are more than controlled, maybe even justified.

Having spent the last year right sizing production to demand, I doubt FoA would want
to change anything from current plans, they seem to be in the "sweet spot" at the moment,
barely managing to meet demand - what a wonderful thing to be able to tell head office...

[Ohio XB]

Barraxr8 is right. Line speed increase is a long term solution, overtime is an interim solution.

When line speed is increased (US) you have to hire more people, pay more benefits, and other costs associated with employees. However, now that American Ford workers will hire in at 1/2 the previous wage and reduced benefits that should not be a problem........right? That's what our government wanted, that's what the people wanted......no more "overpaid trained monkeys," so hiring more employees should not be a problem here.

At our plant where we build the Econoline we are on a four 10 hour day work week, Monday through Thursday. Starting the 3rd week of February we are getting 6 Fridays added to our production schedule and more expected, including possible Saturdays as well.

Steve, Focus is a 2012 model, not 2011 so I doubt you will see it this year.
That was all the commotion at Detroit, that people would have to wait a year for the new Focus.

Thanks for the correction. Here is where I went astray...

From Ford media website:

Sleek, stylish and sporty, both the four-door sedan and five-door hatchback body styles of the next-generation Focus are previewed prior to their production start for Europe and North America late in 2010 and market launch early in 2011.

Our model year starts in September-ish, therefore the 2011 would start at that time, and with production scheduled to start "late in 2010" I automatically assumed the regular model launch schedule to be the same. Models introduced in Spring (April-ish) have previously been designated like "2011 1/2" but lately Ford has pushed the point of "accelerated model introduction", so I would imagine as you said, it will be a 2012.


Steve

[Bossxr8]

Originally Posted by phillyc

This is what I was getting at with increasing production by say 3,000 this year, would only be what 12 days of overtime? The lack of down days this year (hopefully!) would add another 1,500 vehicles. Suddenly, production is now 60,000pa.

I believe there will be some substitution between Coyote & I6T, but overall incremental / conquest sales gains. I think it may even have been you last year talking about the demand for I6T being huge = working long hours which in turn delaying some sales. Burela was saying regularly how many months in advance G6ET was sold out for too. Although if FPV are to assemble the V8, then i'm not sure how many they could build.

Just my thoughts. Putting them out there.

Again, the main thing is to do build and sell profitably.

I'd imagine if they drop the wagon mid year those 400 odd sales would be taken up by extra Falcon, ute and Territory, which would probably cancel out any need to increase rate.

And if LI LPG is introduced in October, that means either Ford will stockpile E Gas cars before July or have no LPG available between July and October. That will screw things up a bit.

[phillyc]

Originally Posted by Bossxr8

I'd imagine if they drop the wagon mid year those 400 odd sales would be taken up by extra Falcon, ute and Territory, which would probably cancel out any need to increase rate.

And if LI LPG is introduced in October, that means either Ford will stockpile E Gas cars before July or have no LPG available between July and October. That will screw things up a bit.

Plenty of questions!
How many LPG cars do Ford sell on a monthly basis?
How many of those are the wagon?
What are the chances of the wagon being dropped?

Dropping the wagon (if they do) would at least allow the reduction in line complexity. Perhaps also increasing the 'first time through'?

Dropping the wagon also allows for more high mix cars too (as you mentioned).

[phillyc]

Originally Posted by Falc'man

Good news. Expected.

A lot of the dollars, lets not forget, were spent bringing out all-new cars at a time when very few were spending - and GM/Chrysler waiting for the doll cheque, stopping R&D on just about everything.

In effect these "losses" Ford had were in fact expenditures necessary that have put Ford in a superior position having superior products, when, as it turns out, the competition is still picking up the pieces.

Like I said, it was expected.

Definitely right there. Ford really stole a march on the opposition and this will be further highlighted in the upcoming years. What we are seeing now, is just a the beginning.

Making money in a terrible economy is a great thing. It really highlights the working together of the UAW & Ford management tied with Mullaly's vision for One Ford.

Making money will also mean that they can compete in more market segments.

[Swordsman88]

Originally Posted by phillyc

Definitely right there. Ford really stole a march on the opposition and this will be further highlighted in the upcoming years. What we are seeing now, is just a the beginning.

Making money in a terrible economy is a great thing. It really highlights the working together of the UAW & Ford management tied with Mullaly's vision for One Ford.

Making money will also mean that they can compete in more market segments.

You need to spend money to make money..... I know a few GM-H fans that have been quiety impressed with the new product Ford has/will be launching in the next year or so....esp the V8, Li LPG etc. They won't admit it per se....but they realise that GM is very much on the back foot RE product devlopment. Its a never ending cycle of improvement and once you get behind its is very very hard to catch up.

There has been some discussion in the coyote threads RE holden/GM meeting future emissions regs with the small block V8s etc. I dont' doubt they will be able to do it (hopefully keeping their power levels competitive) but its the medium to long term that is a problem. Talk is of 2012 before the 'new V8' from GM and ford will have 2-3 years of its very impressive V8 plus ecoboost V6 (and I6 here) on sale on the mean time. That wil hurt the perception of GM as having 'new tech' as much as the atcual deficit in performance, fuel efficency, nvh etc. Toyota has cultured a (often misleading) perception of being 'advanced' and 'firsts'. Now Ford is trying to do the same thing with EB, new V8, DSG transmissions, fuel burn improvements, HMI computer systems and the just the general launchign of new (more cost effective) global models.

While Ford is still in debt things are looking up...i don't see a way out for GM any where near as clearly or at least in the near future.....

[jpd80]

One thing of concern to Holden fans would be if Rudd brings in tough CO2 limits for cars,
Holden are sitting ducks with that 6.0 V8.

[aussie muscle]

and $34.3 billion in Automotive debt

ouch. big business hurts my head to think of the amount of $$$ they burn through.