Ford cancels plans for all-electric large SUV in US writing off $1.9bn

[MikeInWimbledon]

Mmmm, they've come a long way since that.

We've all come a long way from that era.

Not just Nissan, the world's 7th biggest car company with a global turnover of $70 billion.

But the real opportunity, must be the 90% of the world who aren't in Europe or N America as the world goes from 1 billion cars to 4 billion by 2050

That looks like a slam dunk for the Chinese.

 

[st13phil]

Ford and the other major western manufacturers knew this day was coming, and have done so for many years. They underestimated the threat, and probably didn’t see the opportunity for what it was for them or for their new competitors.

I'm not defending Ford or VW, or PSA, or Renault, but let's not forget that the market for EV's is solely due to legislation. Without that they may have existed, but only as a niche curiosity - at least for the foreseeable future. All those manufacturers survive by selling what the market wants to buy, and the market still wants ICE-powered vehicles.

Let's also not forget that absent the subsidies and tax breaks Tesla has enjoyed, it would have failed long ago. All credit to Musk for exploiting the opportunities those subsidies opened up, but to think they weren't (and aren't) instrumental in the viability of that business is extreme folly. The legacy auto manufacturers don't get those subsidies and live or die on good old profitability.

And remember also that while EV's are the legally demanded future in the big western markets, there is still a substantial market for ICE-powered vehicles elsewhere, so extant auto makers effectively have to create a new product line alongside those that already exist, at least in the medium term. In that respect they are in a much worse position than a startup as they either have to juggle repurposing some of their existing manufacturing capability from ICE to EV's or face massive write-offs in the future.

 

[Dryce]

Ford and the other major western manufacturers knew this day was coming, and have done so for many years. They underestimated the threat, and probably didn’t see the opportunity for what it was for them or for their new competitors.

The development costs on vehicles are huge. Predictable volume is critical.

Regulation is uneven. It varies from locale to locale (eg. ULEZ), fromn country to country (eg. 2030 vs 2035), and region to region.

Customers are unpredictable.

Change and the moment where there is a culmination point or tipping point is hard to predict.

Tesla has shuddered on pricing more than once. And the car market is not just about new cars but about resale and finance.

And significantly EVs are a UK market failure *still* after three years of build up. The figures are shocking. So for all the hype in the media and incentives and dictats by government - under 1 in 5 vehicles sold is a BEV and private buyers are purchasing only a small minority proportion of those 1 in 5.

Three years ago a manufacturer like VW or Ford would have assumed the takeup on BEVs would be faster.

Then we get to the products. They tell a story. Sit in a MB EQE and it's a nice interior. It's expensive. The EV drivetrain isn't considered best in class. So nice car - not quite so good EV. Doe people buy them ? Not many. So we have Hyundai who have a very good EV drive train - sit in an Ioniq 5 or Ioniq 6. Interior feels cheap - even on the better spec'ed ones. So nice EV but not such a nice car.

If I visit my local Hyundai dealer they have the ICE products near the entrance, the PHEVs next, and the BEVs are in a separate section that you hav to go looking for. *That* tells you as much as you know about what they are selling to people visiting the dealership. if it's 1 in 5 private buyers of 1 in 5 cars sold that means 4% of their customers are there to look at BEVs.

So 'this day coming' isn't a simple thing. It's companies knowing that if they invest early they can get hammered - if they invest late they can get hammered.

 

[markjay]

...If I visit my local Hyundai dealer they have the ICE products near the entrance, the PHEVs next, and the BEVs are in a separate section that you hav to go looking for.

BTW, on my recent visit to the Hyundai dealership, I was quite impressed with the new Santa Fe 1.6L Hybrid 7-seater.

 

[Dryce]

BTW, on my recent visit to the Hyundai dealership, I was quite impressed with the new Santa Fe 1.6L Hybrid 7-seater.

I was in looking at Ioniq 5 and 6. My target was a nearly new Ioniq 6 First Edition or Ultimate. The salespeople were more interested in selling a Tucson and Santa Fe - and in that section you could see why - it was buzzing - while the EV section was devoid of customers - and sales staff.

My view of the Ioniq 5 and 6 was that Hyundai seem to have had a bunch of summer interns let loose on the final design. Fabric seats gelt like the cheapest and nastiest I have seen for years. The detail finish and plastic textures around the dual screen dash did the cars no favours. I was after a better finished Ioniq 6 they had in nearly new stock but once I tried access to the back seats it was a no-go because of the rear pillar - older pasengers would end up banging their heads.

I took a look at a EQ E and it was nice inside. MB know how to do this stuff. But for the money Hyundai do better EV drive trains. A collaboration between the two might yield a very very nice EV version of the CLA and GLC.

 

[Bobby Dazzler]

I'm not defending Ford or VW, or PSA, or Renault, but let's not forget that the market for EV's is solely due to legislation. Without that they may have existed, but only as a niche curiosity - at least for the foreseeable future. All those manufacturers survive by selling what the market wants to buy, and the market still wants ICE-powered vehicles.

Let's also not forget that absent the subsidies and tax breaks Tesla has enjoyed, it would have failed long ago. All credit to Musk for exploiting the opportunities those subsidies opened up, but to think they weren't (and aren't) instrumental in the viability of that business is extreme folly. The legacy auto manufacturers don't get those subsidies and live or die on good old profitability.

And remember also that while EV's are the legally demanded future in the big western markets, there is still a substantial market for ICE-powered vehicles elsewhere, so extant auto makers effectively have to create a new product line alongside those that already exist, at least in the medium term. In that respect they are in a much worse position than a startup as they either have to juggle repurposing some of their existing manufacturing capability from ICE to EV's or face massive write-offs in the future.

The development costs on vehicles are huge. Predictable volume is critical.

Regulation is uneven. It varies from locale to locale (eg. ULEZ), fromn country to country (eg. 2030 vs 2035), and region to region.

Customers are unpredictable.

Change and the moment where there is a culmination point or tipping point is hard to predict.

Tesla has shuddered on pricing more than once. And the car market is not just about new cars but about resale and finance.

And significantly EVs are a UK market failure *still* after three years of build up. The figures are shocking. So for all the hype in the media and incentives and dictats by government - under 1 in 5 vehicles sold is a BEV and private buyers are purchasing only a small minority proportion of those 1 in 5.

Three years ago a manufacturer like VW or Ford would have assumed the takeup on BEVs would be faster.

Then we get to the products. They tell a story. Sit in a MB EQE and it's a nice interior. It's expensive. The EV drivetrain isn't considered best in class. So nice car - not quite so good EV. Doe people buy them ? Not many. So we have Hyundai who have a very good EV drive train - sit in an Ioniq 5 or Ioniq 6. Interior feels cheap - even on the better spec'ed ones. So nice EV but not such a nice car.

If I visit my local Hyundai dealer they have the ICE products near the entrance, the PHEVs next, and the BEVs are in a separate section that you hav to go looking for. *That* tells you as much as you know about what they are selling to people visiting the dealership. if it's 1 in 5 private buyers of 1 in 5 cars sold that means 4% of their customers are there to look at BEVs.

So 'this day coming' isn't a simple thing. It's companies knowing that if they invest early they can get hammered - if they invest late they can get hammered.

You guys should help Ford come up with reasons, as they’re better than their excuses cited in the article (posted by someone else).

It doesn’t change the fact that the Chinese manufacturers referred to in the article are subject to the same market conditions, legislation, etc.

Long established players in any market are at a disadvantage compared to new players, but new players have many more disadvantages.

Many more new players go bust than established players, but when new players get it right they can really disrupt the market.

 

[markjay]

Have a look on YouTube, and compare how factories in the Far East assemble cars, with how it's done in Western factories.

The latter still have a surprisingly large of humans (even now, in 2024) involved in the assembly process, manually aligning components and tightening bolts etc.