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State of The Compact Car: Focus Will Be Out Of Production For About A Year

9K views 91 replies 36 participants last post by  jpd80 
#1 ·
Automotive News
June 26, 2017



If you want to know how Ford Motor Co. feels about the car segment in North America, look no further than the Focus.

In the span of 15 months, the automaker went from planning to build the next-generation Focus in a new $1.6 billion plant in Mexico to canceling those plans and wedging production in an already-established plant in Hermosillo, Mexico, to shipping the compact car off the continent entirely by consolidating production in China as part of a cost-cutting effort announced last week.

The move is a sharp fall for the small, fuel-efficient sedan/hatchback that was once a major part of Ford's U.S. product plans. Slumping sales that show no sign of picking back up have turned the car into an imported afterthought.

Starting next year, Ford will go about a year without building a single Focus for North America — and the market may not even notice. Production for North America will end in Michigan in mid-2018 and won't begin in China until mid- to late 2019, the automaker said.

"We'd prefer not to have that large of a gap, admittedly," Joe Hinrichs, Ford's president of global operations, told Automotive News. "We think we'll be able to bridge that gap with a combination of stockpiling, and the EcoSport [subcompact crossover] coming in, which will help us have another product in that price band."

As of June 1, Ford had 37,400 Focuses in stock, a 54-day supply, according to the Automotive News Data Center. Sales, however, have plummeted, down 20 percent through the first five months of the year to 67,146.

Analysts say the decision is purely financial, allowing Ford to cut costs on a vehicle that fewer and fewer U.S. customers seem to want.

"If you don't need the capacity of two plants to support the product, you're saving money," Stephanie Brinley, senior analyst at IHS Markit, said in an interview. "It's a matter of matching production to demand."


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#2 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

Starting next year, Ford will go about a year without building a single Focus for North America — and the market may not even notice.
About four years ago gas prices were about $4.00 a gallon, and I leased a Chevy Volt. I now have a car on order rated for 16 miles per gallon, so I am as guilty as anyone else ignoring this type of vehicle.

I drove a manual "SE" Focus about two years ago - it's a great vehicle, and usually gets great reviews. But times have changed.

I think this headline says it all:

Chattanooga gas prices drop another 3.8 cents per gallon to $1.90


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#86 · (Edited)
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

About four years ago gas prices were about $4.00 a gallon, and I leased a Chevy Volt. I now have a car on order rated for 16 miles per gallon, so I am as guilty as anyone else ignoring this type of vehicle.

I drove a manual "SE" Focus about two years ago - it's a great vehicle, and usually gets great reviews. But times have changed.

I think this headline says it all:

Chattanooga gas prices drop another 3.8 cents per gallon to $1.90


.

All of which still cannot even begin to explain all Focus sales number changes.

Go back and look at the Class of Product from 2000 forward - with special emphasis on 2012 and later.

In a word " PowerShift ".

The damage wrought to the Focus nameplate 'franchise' goes well beyond the extra special sales declines sales previous and on going; for damn sure it's not all played out and yet has already poisoned future prospects going forward.

Would not be surprised if there is serious consideration for a name change going forward for USA and Canada if not more.

==


The Year 'off' gives time for suitable and desirable AT replacement to come forward and match scheduling.

Better late than never etc etc

It is not without cost however.
 
#19 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

Cheap gas and consumers want SUVs/CUVs. Market has shifted - I get it. It's a shame more production is shifting to China. Rather see production in Mexico.
What I don't get is how much cheaper can it be to manufacture in China vs. Mexico. As I recall the automakers pay something like a dollar an hour for Mexican labor, meaning I assume Mexican labor is cheaper than Chinese labor. Then add to it the cost of shipping from China to the Americas....

The savings have to be in having only one plant worldwide vs. labor costs. However, I assume the Mexican made focus is sold in all of North and South America, I'd think there would be enough volume to support a plant in the Americas. Guess not.
 
#4 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

I think GM paved the way for Ford to move the Focus to China when they built a vehicle entirely in China to be sold here. The customers didn't reject the car and GM didn't get a lot of grief from it. I expect we will see more of it and it's won't be long until China enters our market in their own name.
 
#11 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

I think GM paved the way for Ford to move the Focus to China when they built a vehicle entirely in China to be sold here. The customers didn't reject the car and GM didn't get a lot of grief from it. I expect we will see more of it and it's won't be long until China enters our market in their own name.
I think the day will come when GM and Ford seriously regret releasing that particular Jeannie from the bottle. The biggest hurdle for Chinese cars being sold in the US is consumer confidence and GM/Ford decided to take that financial risk for them. Once people are used to the idea that China sourced cars are reliable the floodgates will open, but hey, GM and Ford will have milked that cow for a couple years before their demise.
 
#5 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

Interesting approach, I suspect there is a bit of calculate brilliance wrapped-up under what on the surface seems catastrophic.............

The EcoSport set to arrive some time next summer; and looking at what has happened to the Cruze sales (and required discounts to keep sales remotely normal) when the Trax arrived, this seems like a logically planned event, or series of events.

Focus production forecast is basically flat through end-of-life which means, with the addition of the EcoSport the inventory will last a bit longer than what current inventory is turning, factor that in with the roll-out and amp-up of the EcoSport and Ford will find themselves with 6~9 months of the new EcoSport with little internal compact car competition.

Then with the full-reset of the Focus, and being made in a centralized location, Ford can bring over however many they need; won't matter if it's 5,000 or 25,000/month.
 
#6 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

Could we imagine Toyota and Honda reducing the sales of the Corolla and Civic to make room for more CRV and RAV4?

As for the Focus, because compacts don't have enough height...:rolleyes: I spotted that photo on Curbside Classic who did a comparo height of a 1975 Torino sedan with a 2004 Focus.
 
#7 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

You hate to hear this. Maybe......America might be ready for a line of large cars again? Maybe not.
 
#9 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

Consumers are fickle. We are one Middle Eastern crackpot away from a spike in gas prices and the return of the small car. When that happens (you know it's not an if, just a when), Detroit will again be caught with their proverbial pants down.

Why is it that Detroit has to compromise one type of vehicle to push another when everyone else on the planet seem able to strike a balance among different types of products?
 
#10 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

Consumers are fickle. We are one Middle Eastern crackpot away from a spike in gas prices and the return of the small car. When that happens (you know it's not an if, just a when), Detroit will again be caught with their proverbial pants down.

Why is it that Detroit has to compromise one type of vehicle to push another when everyone else on the planet seem able to strike a balance among different types of products?
Domestic automakers have always been terrible at long term plans. Everything is a short-term, knee-jerk reaction, and usually they are late to the party with changes in the market. Remember the original Escalade? Cadillac's ongoing lack of crossovers is embarrassingly delinquent. As for the Focus, it can't help matters that the current model is ancient. Who would buy a Focus when newer chief competitors like the Civic, Cruze and Mazda3 are out there??
 
#53 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

Two words "Eco Sport"

Lets be honest, just as the Trax has stole Spark Sales, so will the Eco Sport.

Unless gas prices Skyrocket, I don't see the need for both.

That's the thing. The difference between fuel costs on a Cruze and Trax aren't significant. Or Verano and Encore, part of the reason Verano died.

Not at $2/gal, not at $4/gal even. We'd have to see $8-10/gal before it mattered. And that isn't going to happen. Between shale and new domestic fields, we have a lot more capacity than we did a few years ago.

Further, most manufacturers already have, or about to start selling, an EV product. In a few more years, if gas was to skyrocket, consumers will simply jump ship to an EV. OPEC would hate to see that, so they WON'T allow gas to go past maybe $4/gal at the very most, and really I think that ceiling is $3/gal. They know it would be suicide.
 
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#28 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

One door closes, another opens,
I'm betting that Ecosport from India is way more profitable than Focus from MAP,
so every sale traded to Ecosport becomes more profit for Ford. It's a great way
to captalize on buyer transition and simply replace Focus when the new car is ready.
 
#34 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

even if oil prices spiked, there is little likelihood that car sales would return,
Utility buyers would simply demand more efficient versions of their vehicles.
+1


So short sighted. Gas prices don't stay low, in addition the Focus isn't selling because it hasn't been updated in a long long time and there are better choices out there.
Is Honda going to stop selling the Civic? Toyota the Corolla? Subaru updated the Impreza, etc etc. Those cars are selling.
How about building a Compact that people want?
Manufacturing in China is yet another demerit. Subaru just started building the Impreza in the U.S.
Ford and GM are just poorly managed companies
I still say vehicles sales (types/sizes) has more to do with employment (and the affordability that allows) than actual price of gas; sure higher prices will put some people on the edge over the edge, but the fuel spend isn't that much difference.

Fiesta, C-Max, EcoSport, Escape, it's not like Ford is doing what Chrysler did..........

Toyota or Honda aren't getting of their small cars, that is the butter on their bread.
 
#31 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

I look in the driveway across the street. It is lined with five CUV/SUVs. Not one sedan in sight. People now just want these high riding space efficient vehicles. In compact classes they find acceptance in smaller versions of the larger vehicles.
 
#32 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

So short sighted. Gas prices don't stay low, in addition the Focus isn't selling because it hasn't been updated in a long long time and there are better choices out there.
Is Honda going to stop selling the Civic? Toyota the Corolla? Subaru updated the Impreza, etc etc. Those cars are selling.
How about building a Compact that people want?
Manufacturing in China is yet another demerit. Subaru just started building the Impreza in the U.S.
Ford and GM are just poorly managed companies
 
#40 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

So short sighted. Gas prices don't stay low, in addition the Focus isn't selling because it hasn't been updated in a long long time and there are better choices out there.
Is Honda going to stop selling the Civic? Toyota the Corolla? Subaru updated the Impreza, etc etc. Those cars are selling.
How about building a Compact that people want?
Manufacturing in China is yet another demerit. Subaru just started building the Impreza in the U.S.
Ford and GM are just poorly managed companies
When gas prices move, they will shift towards more efficient crossovers.

Not sedans.
 
#33 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

CUVs are for the most part ugly. So much for looks informing purchase choices, but what do I know?

Great mileage has never been on my list of priorities. I look at things like drivability, room, comfort, features, design and road presence.

I prefer buying American, more typically GM than not, but have bought European and Asian offerings over the years.
 
#35 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

So my question is: Why can't Ford profitably produce the Focus in the US when GM builds the Cruze here (profitably I believe) and Toyota builds the Corolla in the US as well (very profitably). What gives with Ford? Is Toyota really that much more efficient in designing/building cars?
 
#42 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

So my question is: Why can't Ford profitably produce the Focus in the US when GM builds the Cruze here (profitably I believe) and Toyota builds the Corolla in the US as well (very profitably). What gives with Ford? Is Toyota really that much more efficient in designing/building cars?
We don't know the profit level of any specific line for any make. We assume Toyota is making money on the Corolla, but perhaps presumed higher profits are based on its ancient mechanicals and chassis and relying on its quality image to sell (that other brands don't have) vs. any real magic. And perhaps Ford can make a profit building the Focus in the USA, but they might be able to make MORE profits building in China.
 
#46 · (Edited)
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

The Typical Compact Sedan/Hatch is slightly Smaller/Same size as a Sub Compact Crossover while being just slightly cheaper, In Most Cases ATP's are about the same.

Dodge Dart MSRP $16,995
Jeep Renegade MSRP $17,995

***Mind you the Jeep is a baby SUV, you can move up to a New Compass starting at 20,995- a well optioned $24,995 Latitude trim.

Just a Example
 
#50 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

You people forget quickly. Gm is well aware that small cars are not selling great however they made a statement months ago that they are not dropping out of the market of building them. They realized someday gas will go back up and you need have a decent small car line up which they do have. The cruze and sonic are made in plants that have been around for years so the infrastructure is paid for. Yes it cost money to retool for new designs. But you still may new car buyers who can only afford a small car and not a cuv/suv. Ford is basically giving GM a gift by letting the focus lag like they did before and Gm has the cruze which competes well with cars in its price range. If gas prices staly low I do see a resurgance of larger car based vehicles.
 
#52 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

You people forget quickly. Gm is well aware that small cars are not selling great however they made a statement months ago that they are not dropping out of the market of building them. They realized someday gas will go back up and you need have a decent small car line up which they do have. The cruze and sonic are made in plants that have been around for years so the infrastructure is paid for. Yes it cost money to retool for new designs. But you still may new car buyers who can only afford a small car and not a cuv/suv. Ford is basically giving GM a gift by letting the focus lag like they did before and Gm has the cruze which competes well with cars in its price range. If gas prices staly low I do see a resurgance of larger car based vehicles.
1 Year isn't leaving the market!

Ford isn't giving GM a Gift, it is giving the New Civic/Corolla a Gift. The Cruze is only now becoming a legitimate player in this market, it will take some time to become a "Stealer of Customers"
 
#57 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

There are big plans for the Focus platform, because it is the base for the advanced electrified cars that will allow Ford to stay competitive or leap-frog the competition. Maybe this has something to do with the replacement of the CEO. It is viewed as that important. So this is not what it seems.
 
#61 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

I would agree the CUV/Suv craze is more of just going back to cars back in the 40's and 50's more upright and were easier to get into. Actual passenger space in cuv/suv compared to a regular sedan is not much bigger except in maybe head room.

However a bigger issue is people think that because you can put more in them that you should. None of thes cuv/suv have a much of a higher cargo weight than cars. Just because it can fit doesn't mean you should stuff it full.
 
#62 ·
Re: State of The Compact Car: Focus Will Be Out Of Product For About One Year

I would agree the CUV/Suv craze is more of just going back to cars back in the 40's and 50's more upright and were easier to get into. Actual passenger space in cuv/suv compared to a regular sedan is not much bigger except in maybe head room.

However a bigger issue is people think that because you can put more in them that you should. None of thes cuv/suv have a much of a higher cargo weight than cars. Just because it can fit doesn't mean you should stuff it full.
This is so very true. The CUV's of today resemble the late 1930's and 1940's cars almost to a "T" with a much shorter hood length (don't have to fit those straight 8's anymore). That's what is going on. The market is going back to cars that are easy to get in and out of. Function has almost totally eradicated form.
 
#88 · (Edited)
For all the worry over Powershift, Ford still managed to sell over 15,000 of them last month,
I'm pretty sure that the last of the manual trans stock is now all gone.

The market is eternally forgiving and when Ford fronts with a better product, then maybe
sales will stabilize a bit and perhaps the need for up to $4K incentives goes away,

I gather the plan is to channel stuff dealers with up to 4 months supply of '17s while Ford builds out
'18 inventory at he plant. If I read the plan right, at the end of production, Ford should have about
6 months inventory at the plant and about 4 to 5 months with dealers - enough to skate through.

what's scary with car sales has been the slide on GM's relatively new car products,
Malibu and Cruze both selling much lower than the Fusion and Focus - a sign of the times.

At the moment, there's no safety in having fresh car products.......
 
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