September 10, 2018
THE IGNORANCE REQUIRED TO LOSE MONEY AS THE HOUSE:
After Trump Tweets that the Ford Focus Can 'BE BUILT IN THE U.S.A.,' Ford Explains Why That Would Make No Sense (DAVID MEYER, 9/10/18, Fortune)
Ford's North America product communications manager, Mike Levine, spelled it out for the president in a tweet noting "it would not be profitable to build the Focus Active in the U.S. given an expected annual sales volume of fewer than 50,000 units and its competitive segment."Ford didn't move production of the Focus to China by accident; it did so because the U.S. market has shifted away from smaller vehicles toward SUVs, which has made production of the Focus in the U.S.--a relatively expensive location--an illogical choice.The automaker decided a couple years back to shift production of the Focus to Mexico, then last year it opted for China instead. Earlier this year Ford cancelled all its smaller cars with the exception of the Mustang and the Focus Active.Then, after Trump started threatening his new tariffs against China, Ford decided in August that it wouldn't sell the Focus Active in the U.S. after all. The profit margins were simply too small to be worth it.The auto-sector market economist Jon Gabrielsen told the Detroit Free Press that Trump's tweet was "further evidence that neither the president nor his trade representatives have any clue of the complexities of global supply chains."
Posted by Orrin Judd at September 10, 2018 4:19 AM
