General Vehicle Discussion/News Non-Mustang Vehicle Chat, Other Makes

Debunking the 'It's too expensive to import over here' argument

Thread Tools
 
Search this Thread
 
Old Dec 19, 2007 | 03:28 AM
  #1  
Hollywood_North GT's Avatar
Thread Starter
Closet American
 
Joined: July 17, 2005
Posts: 5,851
Likes: 1
From: Vancouver, BC (Hollywood North)
Debunking the 'It's too expensive to import over here' argument

From Automotive News via Autoblog.

Lutz says importing Astra saved $900 million

The Saturn Astra represents a quantum leap forward for GM in the small car market. For a mere $100 million, which is chicken feed for a new product, the General traded in the uninspiring Ion for the European juggernaut Opel Astra. Many thought GM was merely buying time (literally) until a truly global Astra appears in 2010, since we've been told for years that it was too expensive (see: Focus) to retro-fit a Euro-car for the US Market. Maximum Bob has turned that paradigm upside down, as he explained that the spared development costs have netted GM savings of about $900 million. Of course, GM would probably never shell out $1 billion for a small car with a volume of 45,000 units per year, but since the General makes products all over the globe, it makes sense to sell the best cars and trucks wherever it can. If it helps keep your factories at full capacity while saving $900 million at the same time, than that's cool, too. Hey, if this is the new reality of automakers going global, we're all for it. Now Ford, bring on that Mondeo already!
Reply
Old Dec 19, 2007 | 10:28 AM
  #2  
rhumb's Avatar
 
Joined: January 30, 2004
Posts: 2,980
Likes: 0
From: DMV
Man, Ford needs to hire away Lutz from GM. That guy simply gets things done whereas Ford just seems mired in a morass of beauracracy and why-we-can't-do-it excuses.

Ford still seems to harbor the Old Detroit Think regarding small cars as cheap, money-looser, econo boxes for people who can't afford bigger "real" cars. Rather, GM seems to be understanding that people will want, buy and pay good money for small cars that are actually desirable rather than penalty-boxes.

The current straight-to-rebates/rental-car-lots American Focus borders on embarrasing, to say nothing of the pug-ugly coupe version.

Ford just needs to quit snivelling, quit making lame excuses, buckle down and get the Euro Focus here yesterday. Period.

And the Mondeo? The Fusion's a nice enough car, but nice enough ain't good enough in todays market. If it were, Ford would be drowning in black ink, not red. Get the Mondeo over here, yesterday, too.

How's this for a simple idea, turn the comatose Mercury division into Ford's import division much as GM seems to be doing with Saturn. Mercury's current primped Ford models lineup is about as useful as a third leg. Instead, make it the emporium for global Ford's various, and very interesting, Euro and Aussie wares. Mercury finally gets off life support with a viable mission and lineup, and Ford N.A. customers finally get to tap into all the cool cars we've been denied for so long.
Reply
Old Dec 19, 2007 | 01:58 PM
  #3  
Zastava_101's Avatar
TMS Post # 1,000,000
Serbian Steamer
 
Joined: January 30, 2004
Posts: 12,636
Likes: 0
From: Wisconsin / Serbia
It would've been even cheaper if they just re-badged Cobalt like they did with Pontiac G5. And sales would've been even higher.
Reply
Old Dec 19, 2007 | 02:41 PM
  #4  
rhumb's Avatar
 
Joined: January 30, 2004
Posts: 2,980
Likes: 0
From: DMV
Yeah, but the Cobalt, yawnnnnnn.... Astra's way cooler, especially if they do the obvious and plunk the 2.0 turbo out of the Solstice/Sky in that thing = instant Mazda MS3 /GTI competition.
Reply
Old Dec 19, 2007 | 03:17 PM
  #5  
Zastava_101's Avatar
TMS Post # 1,000,000
Serbian Steamer
 
Joined: January 30, 2004
Posts: 12,636
Likes: 0
From: Wisconsin / Serbia
I like Cobalt more. Astra is way too much European style.
Reply
Old Dec 19, 2007 | 08:19 PM
  #6  
Hollywood_North GT's Avatar
Thread Starter
Closet American
 
Joined: July 17, 2005
Posts: 5,851
Likes: 1
From: Vancouver, BC (Hollywood North)
Originally Posted by rhumb
How's this for a simple idea, turn the comatose Mercury division into Ford's import division much as GM seems to be doing with Saturn. Mercury's current primped Ford models lineup is about as useful as a third leg. Instead, make it the emporium for global Ford's various, and very interesting, Euro and Aussie wares. Mercury finally gets off life support with a viable mission and lineup, and Ford N.A. customers finally get to tap into all the cool cars we've been denied for so long.
Funny how they can't see the obvious when it's right in front of their noses, isn't it?

As GM keeps announcing (and showing) new products and product plans, Ford of North America is... um ... well, I'm not sure WHAT Ford North America is doing, really. Another SE Mustang, per chance? Maybe another SUV/CUV/minivan/truck variant?

They're paying Mulally HOW much, again?
Reply
Old Dec 19, 2007 | 09:12 PM
  #7  
RCSignals's Avatar
Cobra Member
 
Joined: October 27, 2007
Posts: 1,380
Likes: 0
Perhaps the Opel Astra was already designed with the US market in mind?

The problem is usually in meeting US regulations, but some of those regulations seem to be becoming 'global' now anyway.
Reply
Old Dec 19, 2007 | 09:19 PM
  #8  
Q`res's Avatar
Bullitt Member
 
Joined: January 30, 2004
Posts: 238
Likes: 0
From: Kentucky
The idea of Mercury as a conduit for European Fords in America is not a new idea, but it is a good one. I'm always amazed by the circular logic Ford execs seem to employ with regards to Mercury. Mercury isn't a viable brand because it doesn't sell, and it doesn't sell because it's just prettier Fords with a few grand slapped on the sticker. But they won't give it new product that could sell because the rebadged Fords don't sell. It's a case of sticking with what doesn't work. And worse, with what you know doesn't work. And killing Mercury isn't really an option right now either. Just look at Oldsmobile, IIRC it cost GM over 1.5 billion to kill that brand.
Reply
Old Dec 19, 2007 | 10:01 PM
  #9  
jsaylor's Avatar
Team Mustang Source
 
Joined: January 29, 2004
Posts: 2,358
Likes: 1
Originally Posted by Q`res
The idea of Mercury as a conduit for European Fords in America is not a new idea, but it is a good one. I'm always amazed by the circular logic Ford execs seem to employ with regards to Mercury. Mercury isn't a viable brand because it doesn't sell, and it doesn't sell because it's just prettier Fords with a few grand slapped on the sticker. But they won't give it new product that could sell because the rebadged Fords don't sell. It's a case of sticking with what doesn't work. And worse, with what you know doesn't work. And killing Mercury isn't really an option right now either. Just look at Oldsmobile, IIRC it cost GM over 1.5 billion to kill that brand.
Same ridiculous logic Ford, and a few other automakers for that matter, use with their small pickups. Can't have a new Ranger because lackluster sales of the old model 'prove' that the market has dried up for small trucks. Of course, to buy into this theory you have to overlook the fact that the last truly new Ranger debuted about the same time that Noah stepped onto dry land. More incredibly in this market the industry as a whole seems to have collectively come to much the same conclusion apparently giving no serious consideration to the fact that almost all of the product in this segment has either a: gotten so expensive that they rival full size models in terms of cost (see Nissan Frontier), b: gotten so old the appeal is gone (see Ranger), or c: been botched so badly in their latest incarnation that I'm truly amazed they can manage to sell any at all (see Colorado and Canyon).

You don't need a business degree to see the flaws in these arguments. The fact that so many running major companies make six figure incomes to essentially ignore the obvious is amazing.
Reply
Old Dec 20, 2007 | 01:11 AM
  #10  
Black331's Avatar
Bullitt Member
 
Joined: May 28, 2004
Posts: 266
Likes: 1
From: Long Beach, Ca
Originally Posted by rhumb
Man, Ford needs to hire away Lutz from GM. That guy simply gets things done whereas Ford just seems mired in a morass of beauracracy and why-we-can't-do-it excuses.

Ford still seems to harbor the Old Detroit Think regarding small cars as cheap, money-looser, econo boxes for people who can't afford bigger "real" cars. Rather, GM seems to be understanding that people will want, buy and pay good money for small cars that are actually desirable rather than penalty-boxes.

The current straight-to-rebates/rental-car-lots American Focus borders on embarrasing, to say nothing of the pug-ugly coupe version.

Ford just needs to quit snivelling, quit making lame excuses, buckle down and get the Euro Focus here yesterday. Period.

And the Mondeo? The Fusion's a nice enough car, but nice enough ain't good enough in todays market. If it were, Ford would be drowning in black ink, not red. Get the Mondeo over here, yesterday, too.

How's this for a simple idea, turn the comatose Mercury division into Ford's import division much as GM seems to be doing with Saturn. Mercury's current primped Ford models lineup is about as useful as a third leg. Instead, make it the emporium for global Ford's various, and very interesting, Euro and Aussie wares. Mercury finally gets off life support with a viable mission and lineup, and Ford N.A. customers finally get to tap into all the cool cars we've been denied for so long.
I agree except they need to be sold as Ford's, most people have forgotten Mercury exists, and their dealer network isn't there, they'd sell a few and Ford would say "see! nobody wants Euro cars!".
Reply
Old Dec 20, 2007 | 11:10 AM
  #11  
RCSignals's Avatar
Cobra Member
 
Joined: October 27, 2007
Posts: 1,380
Likes: 0
Originally Posted by Black331
I agree except they need to be sold as Ford's, most people have forgotten Mercury exists, and their dealer network isn't there, they'd sell a few and Ford would say "see! nobody wants Euro cars!".
They refer to past endevours bring in Euro cars using that very excuse.
To some point it has validity I suppose but certain models such as the Focus would do fine.
The Ka might also do OK but that one probably will not meet US regulation requirements.
Reply
Old Dec 20, 2007 | 01:07 PM
  #12  
rhumb's Avatar
 
Joined: January 30, 2004
Posts: 2,980
Likes: 0
From: DMV
Sadly, Ford's previous attempts to hawk their foreign wares here have generally been pretty pathetic, with the predictable failure of these efforts now being used to pooh pooh any new attempts to do so.

As an example, having Mercury sell the Merkurs back in the '80s. The Merkur were actually pretty interesting and decent cars, but rather avant garde in appearance. But Mercury dealers had a hard time fathoming how to sell anything without a Landeau roof, wire hubcaps and the interior aesthetic of a New Orleans bordello. Needless to say, the effort eventually failed.

An earlier attempt, with the then German Capri and Capri II did fairly well for a while, though in a fit of tackiness, they fitted
vinyl roofs to some of them -- figuring if it looks good on a hearse, it ought to look good on a European sport coupe too. But then they switched to the FoxStang chassis in '79, which eventually got all bloated in the rear like it was stung by a giant bee and the utter redundancy of selling essentially a fat-assed Mustang doomed it too.

So Ford (mis)management probably looks at these miserable efforts and in their unique circular illogic ask why again? Well, if the intention is to recreate these half-baked efforts then, the answer is obviously not to.

But rather, the question ought to be how to do it right. Mercury is a useful to the Ford marque as a third ******** but they don't have the backbone to euthanize it. So if you ain't gonna kill it, and it ain't working as it is, why not make the division named after the fleet footed messenger god sell some fleet footed cars from the Old World?

The yuppies and fashion-forward folks of America do evidence a viable market for such cars that Ford sells in Europe, so why not do a Lutz and just bring the dang thangs over here. As the Astra argument shows, it'll be a lot cheaper to bring a car to U.S. spec than designing a whole new one from a clean sheet.
Reply
Old Dec 20, 2007 | 03:05 PM
  #13  
jsaylor's Avatar
Team Mustang Source
 
Joined: January 29, 2004
Posts: 2,358
Likes: 1
Originally Posted by rhumb
Sadly, Ford's previous attempts to hawk their foreign wares here have generally been pretty pathetic, with the predictable failure of these efforts now being used to pooh pooh any new attempts to do so.

As an example, having Mercury sell the Merkurs back in the '80s. The Merkur were actually pretty interesting and decent cars, but rather avant garde in appearance. But Mercury dealers had a hard time fathoming how to sell anything without a Landeau roof, wire hubcaps and the interior aesthetic of a New Orleans bordello. Needless to say, the effort eventually failed.
While Mercury dealerships likely need some help the above really isn't a fair summation of what went wrong. The reality of the situation was that the Scorpio and XR4ti were both hella-expensive, the idea being that Merkur was going to slot into the lineup above Lincoln as a sort of American BMW. Unfortunately the Cosworth versions which drew the attention of enthusiasts in the first place never made it over here leaving the otherwise excellent Scorpio to make due with the merely adequate Cologne V6 and the XR4ti to soldier on with the nice, but pushing it at the Merkur's price, 2.3L turbo four from the Mustang and Thunderbird. The combination of somewhat disappointing engine combos and a jaw dropping msrp ensured that these cars were doomed before they ever got off the first boat from Germany.

Originally Posted by rhumb
An earlier attempt, with the then German Capri and Capri II did fairly well for a while, though in a fit of tackiness, they fitted vinyl roofs to some of them -- figuring if it looks good on a hearse, it ought to look good on a European sport coupe too. But then they switched to the FoxStang chassis in '79, which eventually got all bloated in the rear like it was stung by a giant bee and the utter redundancy of selling essentially a fat-assed Mustang doomed it too.
Capri indeed did fine. However, while Mercury certainly needed no convincing to apply vinyl roofs to anything in the 1970's they dont deserve all, or even most, of the credit. FOE fitted more than a few Capri's with vinyl roofs themselves and more than a few likely made it off the boat vinyl roof firmly affixed. Mercury isn't the hopeless case some seem to think and IMO the dealerships ought to be given the chance to hawk some worthy product....something the arguably haven't had in any reasomnable amount since the late 1960's.....before we accuse them of being incapable of doing so.

Originally Posted by rhumb
But rather, the question ought to be how to do it right. Mercury is a useful to the Ford marque as a third ******** but they don't have the backbone to euthanize it. So if you ain't gonna kill it, and it ain't working as it is, why not make the division named after the fleet footed messenger god sell some fleet footed cars from the Old World?
I agree somewhat, with the primary difference being that, IMO, Mercury is effectively the only logical outlet in North America for these cars since they are unlikely to move in the volume needed to make them a good fit for the Ford brand. Factor in the somewhat higher prices these cars are going to need to command to make the profit picture look good and Mercury is the obvious choice here.

Originally Posted by rhumb
The yuppies and fashion-forward folks of America do evidence a viable market for such cars that Ford sells in Europe, so why not do a Lutz and just bring the dang thangs over here. As the Astra argument shows, it'll be a lot cheaper to bring a car to U.S. spec than designing a whole new one from a clean sheet.
The argument painted in that article is a bit too simplistic, and I'm being kind. When talking about volume vehicles intended to be produced and marketed over a subtantial period of time you have to consider what might be lost in terms of volume by going to a global product as the ability to tailor the product to a specific target market is obviously somewhat compromised. Since development costs are relatively small when the product in question is a high volume piece this is a concern that needs to be noted.

Some will no doubt argue that North American isn't doing a very good job of developing worthwhile product right now claiming instead that importation is the simple fix, and they have a point. However, since the product North America is producing is a direct reflection of how management runs these corporations my retort is simple. If these guys aren't competent enough to oversee the devlopment of good product here in the US why would anybody assume that they would have the foresight to seek out good product elsewhere?

The real solution remains to develop and produce good product here and abroad employing the brands already in place to market both worldwide maximing choice and market share. Bring FOE and FOA product to our shores, but do it under the Mercury badge using realistic price, profitability, and volume projections in the process.
Reply
Old Dec 20, 2007 | 07:31 PM
  #14  
Hollywood_North GT's Avatar
Thread Starter
Closet American
 
Joined: July 17, 2005
Posts: 5,851
Likes: 1
From: Vancouver, BC (Hollywood North)
At this point, I don't care WHAT Ford does, but they better do something...and fast.

Like the old saying goes: As long as you keep doin' what yer doin', you'll keep gettin' what yer gettin'. And with few exceptions, we all know what we've been gettin' from Ford in recent years.
Reply
Old Dec 21, 2007 | 09:16 AM
  #15  
Slims00ls1z28's Avatar
Mach 1 Member
 
Joined: May 18, 2007
Posts: 830
Likes: 0
I'd love to see a reskinned S197 in the form of a cougar. Just like the 1st gen stangs. Making the cougar a Tbird clone was dumb imo. It would be cool IMO to see Mercury as a competitor to the new range of pontiacs comming . Aren't they both in essence the same thing upscale versions of their twins?
Reply
Old Dec 27, 2007 | 02:32 AM
  #16  
bob's Avatar
bob
Legacy TMS Member
 
Joined: May 16, 2004
Posts: 5,206
Likes: 18
From: Bristol, TN
Originally Posted by Hollywood_North GT
They're paying Mulally HOW much, again?
Its probably not Mulally, Ford still has alot of old guard left in managment, along with old ideas and old ways of doing things, The shareholders need to get a clue and fir... I'm mean offer a nice retirement package for the lot of them and keep on replacing with a new crew.
Reply
Old Dec 27, 2007 | 03:08 PM
  #17  
TomServo92's Avatar
Legacy TMS Member
 
Joined: June 18, 2004
Posts: 3,990
Likes: 34
From: Conroe, TX
This "rebadging-Opels-as-Saturns" has not yet proven to be a successful strategy. The Aura has sold far below expections in spite of all the accolades heaped upon. It will be interesting to see if the Astra fares any better.
Reply
Old Jan 3, 2008 | 01:19 AM
  #18  
bob's Avatar
bob
Legacy TMS Member
 
Joined: May 16, 2004
Posts: 5,206
Likes: 18
From: Bristol, TN
Originally Posted by Slims00ls1z28
I'd love to see a reskinned S197 in the form of a cougar. Just like the 1st gen stangs.
The segment is gonna get real crowded like NOW! Mustang - Challenger - Camaro - Tiburon, err genesis or whatever they will call it. Why would Ford want to split development money on a car that would compete against the Mustang for a platry increase in sales? It didn't work for GM, I doubt it would work for Ford. Just for giggles, lets say Ford decided on a 60/40 mix (60% Mustang/40% Cougar) and Cougar only managed to sell 25%, As an exec what would you do if Cougar failed to meet sales expectations and you were limited in the amount of money allocated to the Mustang/Cougar program? Thats right, no need to waste development dollars on Mustang, they've captured 75% of the sales. We need to differentiate it more add more content, ect, ect, ect.

IIRC, in the time that Camaro got one face lift, Firebird had been through 2 front ends, 3 or 4 tails and 1 interior and all Camaro got for it was a lousy scoop and some SS badges, compared to Mustang's various SEs (Bullitt, Mach, Cobra, and so on). Even worse, Camaro was the sales leader between the two F bodies but got little if any money.

The intent was obvious, increase Firebird sales, but the execution ultimately helped to put another nail in the F-body's demise in 02.

I dont want that for Mustang, especially if sales take a dive with Challenger/Camaro coming on board.
Reply
Old Jan 3, 2008 | 03:00 PM
  #19  
RCSignals's Avatar
Cobra Member
 
Joined: October 27, 2007
Posts: 1,380
Likes: 0
I really doubt we'll see anything like a Cougar for the near future anyway, so I'm sure the Mustang is safe
Reply
Old Jan 27, 2008 | 03:04 PM
  #20  
Maverick128's Avatar
Legacy TMS Member
 
Joined: August 4, 2004
Posts: 525
Likes: 10
The Astra's a nice looking car, but after test-driving an Opel, I wouldn't get one. It's not the power or the looks. It's the fact that you can't see crap out the back window. Parking sensors are a MUST if you buy this car.
Reply
Related Topics
Thread
Thread Starter
Forum
Replies
Last Post
kponypower
GT
13
Jun 17, 2020 07:17 AM
FromZto5
General Vehicle Discussion/News
75
Oct 5, 2015 02:27 PM
PonyMuscletang13
2010-2014 Mustang
4
Sep 29, 2015 09:40 AM
JonathonK
General Mustang Chat
1
Sep 24, 2015 06:31 PM




All times are GMT -6. The time now is 10:29 AM.