Posted by
John on Thursday, July 20, 2006 12:24:33 PM
I know a lot of you are for fewer SUVs, reduced emissions, and so on.
As a conservationist, I more or less agree with that take. What's more,
it's clearly an advantage to aggressive foreign governments when the
American populace is so dependent on foreign oil. That said, having a
family or small business in America is next to impossible without an
SUV / minivan. On balance, they bring a lot more value than they take
away.
A few years ago, Ford management made a concerted effort to focus on
low-emission vehicles and fuel cells. These are two gee whiz
technologies that simply have no market. The only thing buying a hybrid
car gives you is moral superiority, because it's clear that there's no
marked energy-use benefit.
Now,
Ford is paying for this decision.
Ford Motor Co. said Thursday that it
lost $123 million in the second quarter due to slumping sales and the
cost of shedding personnel.
Shrinking sales, downsizing. It's pretty clear that this is going on
across all US automakers to a large extent, and a lot of the blame
should fall on the unions, health care, etc. But Ford has made a gamble
based on junk science and feel-good economic analysis.
The company said it had a pretax loss of $797
million in North America, an improvement over last year's $907 million
loss in the second quarter. It said the cost reductions were offset by
the market's shift away from trucks to lower-margin cars, higher sales
incentives and adverse foreign currency exchange rates.
More incentives and shrinking sales? Think about that - you've got
product that no one wants or can justify. Lower-margin cars? So the
stuff that no one wants is costing more to make. I'm not trying to make
my whole case based on a single poor showing, but I'd say thte evidence
is becoming clearer. Instead of
bearing up under the tough conditions, their ship is sinking as fast or
faster than GM and Chrysler. I don't know - could be a coincidence.
American companies succeed by acting American - bigger, better, laser-like focus on Americans.