Blurred Focus How Ford mishandled its serviceable little car ($4-5 Thousand loss each car)

Business Week ^ | 06/19/2006

[Responsibility2nd]

In May, an otherwise dismal month for Detroit, Ford Motor Co. (F ) sold more than 20,000 Focus subcompacts, the fuel sipper's best showing in nine months. That's great news, right? Not really. Ford lost an estimated $4,000 to $5,000 on each Focus it sold.

What irony. Just when the subcompact market is heating up, Ford can't make money on a car acclaimed for its taut handling and decent 26/32-mpg fuel economy. The auto maker's Focus problem (pun intended) is an object lesson in how Ford continues to be hamstrung by high labor costs and tired product design. By choosing not to remake the Focus for the U.S. when it had the chance, Ford misread the road ahead. Now the auto maker is working overtime to bolster the Focus, albeit not until 2008, with a face-lift plus three new small cars.

When it hit the U.S. in 2000, the Focus was widely applauded. Car & Driver magazine named Ford's zippy subcompact to its influential "Ten Best" list four years running. But by 2003 the Focus had suffered more than 12 recalls. And when Ford redesigned it in 2004, the new Focus appeared only in Europe, where Dearborn felt it could fetch a decent price. Meanwhile, the U.S. version received just cosmetic upgrades.

[Responsibility2nd]

Looking for a Big 3 Bashing Thread? Here it is.

[2banana]

Ford insiders say the new trio will be built in Mexico, where labor costs are lower and where the auto maker is already building the Fusion, Lincoln Zephyr, and Mercury Milan.

It is not all doom and gloom from the article. And Ford seems to be learning...

[capt. norm]

Looking for a Big 3 Bashing Thread? Here it is.

Over the years (since the late 50's) I have been 'bashed' by all three. They have it coming.

[PeteB570]

Yeah that 86 Chevy Truck paint failure by 1991 kinda POed me when they said "Too Bad, Oh So Sad." and "Not Our Problem."

[dalereed]

"26/32-mpg fuel economy"

That's not good milage!

My wife's Lexus gets that and it's at least 1/2 of what I consider a car, the Focus is a Tonka Toy.

[AConnecticutYankee]

Well I love my little Honda built in the USA

[1FASTGLOCK45]

capt. norm wrote:
"Over the years (since the late 50's) I have been 'bashed' by all three. They have it coming."

--I guess your wallet and time consumed have been bashed hard.
Nothing worse than a car that is crappy. well besides lefties.
I've gotten rid of cars that kept having major issues, it really drives you nuts.

[Ben Mugged]

I wonder if Ford has GM's UAW problem? They shut down a line and still must pay the workers full time for the rest of their employment career. They pay them to sit in a room and watch television.

[Niteranger68]

Critics lavished praise on the European Focus, while noting snidely that Ford clearly thought Americans were too dumb to realize they were getting an old car.

This comment wipes out what little creditability the story had.

[FreedomPoster]

Ford insiders say the new trio will be built in Mexico, where labor costs are lower and where the auto maker is already building the Fusion, Lincoln Zephyr, and Mercury Milan.

Amazing how Honda and Toyota manage to build Accords and Camrys and Avalons here in the U.S. just fine, thank you very much.

[mnehring]

Honda and Toyota (as well as BMW who also builds in the US) know how to efficiently build a vehicle, stay within budget and not bend over and drop their pants for unions...

[Responsibility2nd]

The very next sentence: The new cars will arrive five years after Toyota Motor Corp. (TM ) launched the Scion brand to go after the same market and three years after Chrysler (DCX ) knocked out three new models to beat up on the Focus. Ford is hoping late is better than never.

What I see: Just after Ford brings these new models to showrooms; the imports will be right behind with new better technology.

Bottom line: Ford - once again - will be a day late and a dollar short.

Oh well, at least Ford can thank God they're not GM.

[mewzilla]

My Scion xB's ruined me for any other small car.

[Buck W.]

"Amazing how Honda and Toyota manage to build Accords and Camrys and Avalons here in the U.S. just fine, thank you very much."

Do they employ union labor?

[Steely Tom]

Ever since buying one 30 years ago, I've thought that Ford must be run by the most stupid people in the car business, and maybe in the world. This article would seem to support that judgement. Every time I see a picture of that moronic-looking Ford offspring (what's his name... Bob? Bill?) that currently sits in the CEO's chair, I think of my conclusion and say to myself: yup.

[Chi-townChief]

Sticking with my '02 Camaro and '99 Firebird for another 8 to 10 years at least (unless one of them gets clobbered and totaled like my '91 Camaro did last year.)

[Responsibility2nd]

Why do you say that? I'm not sure how many, but Europe had the Focus years before America did.

[allen08gop]

Subsidized by other markets? Built at a loss to drive GM and Ford out of the market?

Just asking...

[operation clinton cleanup]

Geez... something this small should get at least 50 mpg on the highway!

[AConnecticutYankee]

Well I do have a beef with Honda. The car is only five years old and the rubber on one windshielf wiper has gone bad. But when I showed it to the dealer he replaced it, so I'm not going to complain too much.