No regrets about Aussie Focus

[vztrt]

http://theage.drive.com.au/motor-new...802-1i8rh.html

No regrets about Aussie Focus: Ford

Jez Spinks
August 2, 2011 - 2:45PM

Small car sales still strong, large cars falling ... but Ford stands by decision to abandon plan to produce its Mazda3 rival in Australia.

Ford says it has no regrets about backtracking on a plan to build the Focus small car in Australia but has refused to rule out changing its mind again.

The local car maker this week launched the third-generation Focus hatchback and sedan in Australia, a model that is initially being imported from Belgium before production moves to the cheaper source of Thailand in mid 2012.

Ford Australia announced in 2007 it would build 40,000 Focus models a year at its Broadmeadows, Victoria, plant owing to the increasingly popularity of small cars, but it abandoned the plan two years ago to instead concentrate investment and government funds on a a diesel Territory and upcoming four-cylinder Falcon.
Advertisement: Story continues below

Company president Bob Graziano, who took the helm in late 2010, is confident the company has made the right move despite small cars currently outselling large cars such as its Falcon by three to one. Rival Holden has also started local production of its Cruze small car this year bringing a more expansive range.

"I wasn't obviously here [at the time of the Focus decision], so I don't' have the same retrospective view of it that you may have," says Graziano.

"But as I look our strategy from our One Ford [global product] standpoint, and I look at where we have the capacity and where we are building those products now, the opportunity to build a fairly large number of those [Focuses] in those sites [such as Europe and Thailand] ... I think that's beneficial for us because you want as much scale [of product] as you can get.

"I can't comment on whether they were right decisions [taken by previous management]. But I believe they were the right decisions when they were taken and they remain the right decisions today."

Falcon sales slumped 37 per cent between June 2009 and June 2011, while Focus sales have risen – albeit by a small margin of 6.3 per cent. However, the Focus continues to be comprehensively outsold by key rivals such as the Toyota Corolla, Mazda3, Hyundai i30 and Holden Cruze. Even the premium priced Volkswagen Golf has outsold the Focus this year.

Graziano wouldn't be drawn on whether the company could change its mind again down the track on whether the Focus would be produced in Australia, stressing the company was focused on its current local product. He says he is optimistic sales of its Falcon sedan and ute, and the Falcon-based Territory soft-roader will start to flourish now that Ford has completed its $232 million investment in more fuel efficient engines for its locally built models.

"We're just in the process of rolling out all that technology," he says. "So we're really looking forward to getting Falcon LPI, freshening of Falcon and [the] Ecoboost [four-cylinder engine] out there and see what happens with those vehicles. We think that's what customers are looking for in the large car segment."

Ford Australia was due to begin production of the Focus in 2011 before the about-turn, and the decision looks set to cost it sales for about a year as the company admits supply of Focuses from Europe will be constrained.

Once supply comes from the free-trade-agreement territory of Thailand – meaning it dodges the 5 per cent import tariff - the company says it is confident the new Focus will perform better against class sales leaders such as the Mazda3 and Toyota Corolla than its predecessors.

"Yes, this Focus will outsell the previous Focus ... easily double digit improvement," Beth Donovan, Ford Australia's vice-president of marketing, sales and service.

"We are absolutely focused on the fact that we should be able to do what other products like a Mazda3 have been able to do [in terms of sales volume]."

[kpcart]

no regrets... but is this bad news right?

[a-total-tool]

Out of curiousity, What will happen to the value of the cars when they switch to being built in Thailand?
Will there be 2 different prices/values? One for the Asian vs Euro built?

[Brazen]

The more I hear, the more I think the next Falcon will be a true global car with exports to a lot of places. They need volume and comments in recent articles about the next falcon being an export vehicle seems to show that they see a lot of volume coming up.

Interesting not ruling Focus being built here down the track (although thats not saying much), I still thought Kuga would be a good vehicle to build here on the Focus line. Also interesting Toyota made comments at the Melbourne motor show about studying building the Corolla or Rav4 here.

[aussie muscle]

it would look silly to have cars built here at 3 times the cost of those built in Thailand.

[Falc'man]

Originally Posted by aussie muscle

it would look silly to have cars built here at 3 times the cost of those built in Thailand.

Yes. Last month Holden said if they weren't to receive more from Centrelink then Cruze is simply not viable.

[JC]

Originally Posted by a-total-tool

Out of curiousity, What will happen to the value of the cars when they switch to being built in Thailand?
Will there be 2 different prices/values? One for the Asian vs Euro built?

Probably not much to end price to consumer - just more profit to Ford.

[Fiesta God]

Originally Posted by a-total-tool

Out of curiousity, What will happen to the value of the cars when they switch to being built in Thailand?
Will there be 2 different prices/values? One for the Asian vs Euro built?

There could well be a fall in the price of brand new vehicles ...

The price of a Fiesta dropped about $500-$1000 when production switched to Thailand from Europe.

It doesn't seem to have had much of an effect on re-sale values however.

[Smoke Pursuit]

Problem is we won't see full supply of Focus till 3rd quarter next year some are saying...

Which means it will be a flop simply because Ford Aust cannot get supply... Shame, I have driven one and they are a great car.

[Road_Warrior]

At the end of the day the C-segment is a cut throat segment with slim profits. In the precarious position FoA is in, it can't afford to take such a gamble however the caveat I'll attach to that is that producing the Focus here could have enabled them to make the Kuga here as well.

Ford are legendary for being tightarses so you can bet your bottom dollar they would have done the cost v benefit analysis ad nauseum to make sure they weren't going to burn a single cent.

[falconnut]

I am okay with this.

Last thing we need is another small car in a already saturated model lineup.

[vztrt]

Originally Posted by a-total-tool

Out of curiousity, What will happen to the value of the cars when they switch to being built in Thailand?
Will there be 2 different prices/values? One for the Asian vs Euro built?

Seeing as the majority of Focus are from South Africa I think you'll see better cars coming in. Only the XR5 and the early Focus were from Europe. NZ got the Europe built cars.

[jpd80]

South Africa Focus production is finished, the plant is switching over to T6 Ranger,
all new Focus come from Germany until Thailand starts third quarter next year...
Ford maximizing profit from Thailand Vs increasing production from Broadmeadows,
they did the right thing but now Holden look like champions in the eyes of Aussie buyers,
it's still sad to think the the best ever Focus will be tarnished by "made in Thailand" label...

[Bossxr8]

Originally Posted by jpd80

South Africa Focus production is finished, the plant is switching over to T6 Ranger,
all new Focus come from Germany until Thailand starts third quarter next year...
Ford maximizing profit from Thailand Vs increasing production from Broadmeadows,
they did the right thing but now Holden look like champions in the eyes of Aussie buyers,
it's still sad to think the the best ever Focus will be tarnished by "made in Thailand" label...

How many people who buy a Focus even know where it is made. Or for that matter how many people who buy a Hilux know its made in Thailand?

[In Focus]

How many people know where a Cruze is made? I haven't noticed Holden being shy about letting everyone know...

[Joe5619]

I wounder what ford considers "limited" supply from Germany? 500, 1000, 1500, 2000 per month?

[a-total-tool]

Originally Posted by In Focus

How many people know where a Cruze is made? I haven't noticed Holden being shy about letting everyone know...

I know that. Did you know that the first ones were still made by daewoo in Korea? If you bought one up to 6 months after the ads started, it would have still been a Korean build.

Second threadjack - would the overall build quality change? Did the fit and finish or the features/specifications change for the Fiesta when they moved manufacture from Europe to Thailand?

[In Focus]

The Thai Fiesta lost the journalists' favourite trivial and irrelevant quality test (softer touch materials on the dash). It also lost some of the steering wheel adjustment capabilities and a spare tyre (swapped for a can of goo).* I'm not sure on a comparison of the general fit and finish, but I suspect all small cars aren't quite as well finished as they used to be (even Corollas), since they cost more or less the same now as they did a decade ago - you can't keep getting more features, such as airbags, Bluetooth and so on, without some compromises.

* It did, however, gain an improved auto gearbox, diesel option for the "lower" spec models, more airbag options lower in the range etc.

[drew`SEVNT5]

Originally Posted by In Focus

The Thai Fiesta lost the journalists' favourite trivial and irrelevant quality test (softer touch materials on the dash). It also lost some of the steering wheel adjustment capabilities and a spare tyre (swapped for a can of goo).* I'm not sure on a comparison of the general fit and finish, but I suspect all small cars aren't quite as well finished as they used to be (even Corollas), since they cost more or less the same now as they did a decade ago - you can't keep getting more features, such as airbags, Bluetooth and so on, without some compromises.

* It did, however, gain an improved auto gearbox, diesel option for the "lower" spec models, more airbag options lower in the range etc.

Irrelevant?

Back in the day, I was considering a XR5 Focus... Two things made me dismiss it without even driving it... The dash plastics, in both look and feel, and how bloody high the seat was, even at lowest...The dash plastics were truly horrid, IMO

[In Focus]

Originally Posted by drew`SEVNT5

Irrelevant?

Back in the day, I was considering a XR5 Focus... Two things made me dismiss it without even driving it... The dash plastics, in both look and feel, and how bloody high the seat was, even at lowest...The dash plastics were truly horrid, IMO

I guess everyone has their reasons for choosing/not choosing a car, but how often do you feel your dash when you're driving the car? Mine's softer than the wife's Fiesta, but they're both under dashmats, so it makes no difference.

[BHDOGS]

haha dash softeness i agree i mean i prefer my power window buttons are made of gold dug from australia but it was dug up from africa how uncouth the nerve never buying a car again

[jpd80]

Originally Posted by Falc'man

Yes. Last month Holden said if they weren't to receive more from Centrelink then Cruze is simply not viable.

What Ford and Toyota heads didn't say was that there has been a big change in product mix from when Ford assessed Focus for Australia,
I suspect that their product mix was heavily biased towards low series versions which was the norm a decade ago but as recent experience
has shown, buyers are now selecting mostly mid and high series cars which puts a completely different spin on the numbers and in short,
Focus could have been built here successfully but Ford chose to capitalise on the change in product mix by maximizing profit with a Thai plant.

Ford has at best four golden months to push Focus sales up to higher levels, if they don't have sufficient product or the correct mix then
Focus will continue to potter along at 800-900/mth and the likes of Holden & Mazda will power on and take lots of sales away from Ford.

[Bossxr8]

Ford have forecast double digit growth in market share for Focus. How many that means I have no clue but it at least indicates they are banking on increased sales, but more than likely not getting enough supplies to match demand.

[Falc'man]

Originally Posted by Bossxr8

but more than likely not getting enough supplies to match demand.

Do Ford HQ judge Ford Au on their profits when Ford Au can't get supply? It wouldn't seem fair if they do. They obviously know this as it's been happening for a while. How can they expect Ford AU to fight with one arm behind their back? They're more or less a rhetorical questions and what I'm eluding to is in the bigger scheme of it I don't think Ford Au's purpose is to be a cash cow more than they're an engineering centre.

[Road_Warrior]

I don't think Detroit has ever expected FoA to be a cash cow. The numbers simply don't stack up compared to the US domestic market or China or whatever.

This is probably the reason why Detroit started tipping in the cash to make the Australian operation more appealing and make better use of the assets here (referring to the engineering and design centre)

[DJM83]

Originally Posted by drew`SEVNT5

Irrelevant?

Back in the day, I was considering a XR5 Focus... Two things made me dismiss it without even driving it... The dash plastics, in both look and feel, and how bloody high the seat was, even at lowest...The dash plastics were truly horrid, IMO

Ive never felt my dash like that and its still better then cars made here IMO.


Seems there is a few issues with the Thai Fiesta/Focus around the traps though, will the new one be the same.

Would the quality have been any better made in OZ then Thai? Id like to think so.
But as was posted most would even know it was made in Thailand when they buy one. I thought all Focii were built in Germany until i bought my XR5 and found out.

[Polyal]

I agree with the above, it's better for us in the short term to be building lower number of falcons than lots of focuses...we would have never been competitive with asia, ever.

In all honestly as long as FoA isn't bleeding then I have a feeling Ford NA are a little WGAF. Because IMO they will loose more through canning the falcon than saving a few mill by going global or importing 100%. I'm worried the flow on effect from canning the falcon will tarnish the brand. Because they sure as hell keep all their R&D work close to their chest. We will see I guess.

[jpd80]

Originally Posted by Polyal

I agree with the above, it's better for us in the short term to be building lower number of falcons than lots of focuses...we would have never been competitive with asia, ever.

In all honestly as long as FoA isn't bleeding then I have a feeling Ford NA are a little WGAF. Because IMO they will loose more through canning the falcon than saving a few mill by going global or importing 100%. I'm worried the flow on effect from canning the falcon will tarnish the brand. Because they sure as hell keep all their R&D work close to their chest. We will see I guess.

Dearborn likes Australia, likes the products FoA turn out on modest budgets.
Now that the wolf is no longer at the door, Ford has much more breathing space
to support various divisions like Australia by offering them engineering project involvement,
access to all areas of Ford technology to give them every chance in the Aussie market.

Ford is not going anywhere, neither is Falcon or Territory...

[Falc'man]

Originally Posted by Road_Warrior

I don't think Detroit has ever expected FoA to be a cash cow. The numbers simply don't stack up compared to the US domestic market or China or whatever.

This is probably the reason why Detroit started tipping in the cash to make the Australian operation more appealing and make better use of the assets here (referring to the engineering and design centre)

Yes, that's how Ford Au should be seen, as a design and engineering centre. When the sky is falling and we're subjected to hissy fits in the pub because of "low" sales, the experts come out and tell us how Ford should run their business, sack their marketing personnel, kill the Falcon, etc etc, I've always sat back and thought of Dearbon as thinking what Polyal just said they might be thinking, "wgaf".

[Bossxr8]

Originally Posted by Falc'man

Do Ford HQ judge Ford Au on their profits when Ford Au can't get supply? It wouldn't seem fair if they do. They obviously know this as it's been happening for a while. How can they expect Ford AU to fight with one arm behind their back? They're more or less a rhetorical questions and what I'm eluding to is in the bigger scheme of it I don't think Ford Au's purpose is to be a cash cow more than they're an engineering centre.

Its just a simple fact that the European market is more important than the aussie market is, and they get preference considering they designed and build the thing.

It was either cop the lack of supply or wait 12 months for production to start in Thailand, which would have been stupid. Saarloius is at full capacity and can't build anymore than they are.

I guess if the demand is so good they will just have to let the orders pile up and make customers wait. It hasn't seem to have effected VW, they have big waiting lists for the Golf and Polo but they still get plenty of people wanting to buy them. People might wait 6 months for a VW, but will they wait 6 months for a Ford?