If you been reading the business news lately you probably read by now how bad Ford is doing in selling vehicles. Lots of plants are going to close and lots of people losing their jobs. Some say Ford is in worse shape than GM. The oddsmakers in Vegas are taking bets on which company will file for bankruptcy first.

Most of the automakers problems are the fault of the UAW. Wages and benefits way to high to be competitive with the Asian cars. The only thing that might save them is to bust up the union and get the UAW out of there all together.

 

GM and Ford are both in bad shape. UAW and pension plans are killing them. But enough about that.

Their cash cow has been the big high dollar SUV. They even admit (Ford) that they make $20k profit off some SUVs. The big SUV sales have fallen and while GM has announced plant closings (2008 and beyond due to UAW agreements), they didn't even touch the Arlington GM plant (big SUVs). My prediction which assumes they (Ford and GM) use short sighted logic (hey, public companies run quarter to quarter and manage to stock holder expectations w/o true regard to long term strategy) - the small SUVS like the Escape will have a base price of around $30k when they redesign. Since it's one of their best sellers, they'll use the short sighted logic. They'll put in a 3.5 V6, tranny with more gears and high profit bells/whistles. The base will start at $30k and go well beyond that for other eye candy options. They'll try to recover some of their higher profit margins to the detriment of the affordable crossover vehicles such as the Escape.

I think they'll be in even worse shape 2 - 3 years from now.

 

If what you say is true, you are right, in 2 -3 years they will be in worse shape. Placing the Escape in $30K+ range will put it out of reach of many potential buyers, you really think they are that dumb? The Escape today is not worth $21K to $23K so how can they even think of raising the price even with all those bells and whistles added...but what did PT Barnum once say, "there's a sucker born every minute".. I guess if you build it, they will buy it..meanwhile the Asians are building SUV's and selling them for $17K to $20K and Ford and GM wonder why they can't sell their vehicles....

 

I think they'll be that dumb. While the Escape didn't have impressive volume numbers in 2001/02, that's changed. With a redesign to make it more "upscale", they'll try to capture their high profit customer base. But that's just my opinion.

What Asian vehicle in the $17-20 range is a real competitor? Don't say Kia, Daiwoo (sp?), Hyundai, Suzuki, or Mitsubishi. They've got their issues though the ugly Hyundai has improved their quality. Kids like them or the in-town driver that never has to drive 70mph.

The Jeep is finally a contender though it's on a real truck platform and rides rough with less room. I seriously looked at the Honda CRV when I totaled my first Escape but a cheap interior, flimsy cup holders, dash mounted shifter and step-van style vertical e-brake really made it a turn off. They still build them overseas so it was also about $4k higher in price than a comparable Escape. Nissan messed up the Xterra body style plus it gets lousy mpgs. Now some higher-end SUVs in the Honda/Nissan/Lexus catagories beat it but at twice the price.

 

Actually the Hyundai Sante Fe is not a bad SUV. People seem to hate or love the look of it though. I think they have made some major improvements in the Sante Fe since it first came out. They have to work on an engine though or trim some weight off the thing because from what I heard the 6 cylinder gas milage is terrible. What is with the Tuscon? Small SUV, smaller than an Escape, comes with 6 cylinder engine gas milage worse than the Escape?? (Kia Sportage and Hyundai Tuscon same vehicle). The old Kia Sportage was a throw-away SUV, I guess time will tell if the new Sportage/Tuscon hold up.
The Toyota RAV 4 is holding its own, people still buying it because of the Toyota name plate on it, my opinion, terrible noisy riding over priced SUV, not worth the high marks it gets from the reviewers.

Not Asian, but the Equinox and Torrent are in the same price range as the Escape and seem to be pretty decent vehicles, don't know much about them to comment more.

Forget the Suzuki's, both of them, for some reason these vehicles are also gas guzzlers and I think they only come with 6 cylinder engines.

I think another competitor the Escape has is the Subaru Forester. A very nicely built vehicle that has been around awhile and has been very reliable.

I do have to make one comment on the Honda CRV, even how over rated they are, they hold their value like diamonds. When I bought my Escape just about a month ago, they had a 2002 Honda Civic in the showroom, it had 52,000 miles on it, it was very clean and they did a good job detailing the interior, the car looked new. It was Certified by the dealer and had a price tag on it of $18,999!! This vehicle new only cost about $21K or $22K. The Escape I bought from them was 2003 XLS V6 4x4 and had 32,000 miles on the odometer, 20K less than the Honda CRV, they sold me the Escape for $14,000...the Honda was 1 year older and had 20K more miles on it, but was priced $5000 more than the Escape I bought...I call it Honda Hype...

 

While the UAW is responsible for a lot of the trouble, don't spend all of your sympathy on poor little Ford. Ford needs to realize that a large part of their problem is self inflicted. How many poorly engineered, poorly assembled, poorly supported products have they produced over the years. I owned a 1982 Ford Escort, my Father owned a Pinto - ancient history you say, maybe. What's not ancient history is the 01 Ford Ranger I now own. This truck has had it's share of "quirks"...

*transmission repaired 3 times before it finally got a new valve body
*drive shaft replaced
*3 fog lights replaced
*engine pulled to fix timing chain rattle, unsuccessfully (a problem Ford has known about since 97, but has chosen to ignore)
*leaking rear main seal replaced
*leaking front differential repaired
*leaking oil filter adapter repaired
*the fit and finish quality can't touch any Honda or Toyota I've owned

Point is, the quality just isn't there. If my business were failing. the first thing I would look at would be the quality of the product I offer.

 

Honda has always said their vehicles hold their value. We got rid of the wife's 02 V6 Accord (loaded) with 30k miles back in June. We got offered average trade at several places, tried selling a little higher (no bites) so we took the $14k. It dropped $8k in a little less than 3 years and with very low miles.

I totaled my 02 V6 XLS Escape (85k miles) in January and average trade was around $8k (insurance pays retail though). We had bought these vehicles one day apart. Both lost around $8k in value and the Escape had higher miles. Yes, the Honda market value was higher but I paid more when it was new too. I wasn't too impressed with it retaining value. Now the dealership will become proud and probably listed it at $17k+ on the lot.

 

From my previous post "When I bought my Escape just about a month ago, they had a 2002 Honda Civic in the showroom, it had 52,000 miles on it, it was very clean and they did a good job detailing the interior, the car looked new. "

It should of read "2002 Honda CRV", not Civic..

 

Neither Ford or GM is in the dire straight that some people want to think they are. Even though both have lost money this year they still have 10's of billions in cash at the bank. This is just another cycle in the business, the same happened about 30 years ago and everywhere you heard the same as you do now, that they are about to go under. Yes the medical and retirements benefits are a big drain on both companies, the threat or talk of bankruptcy is only to cut those costs. The Asian companies are starting to figure that out themselves, the longer you are in business the more retirees you have to pay. There was a time when the Japanese companies would give you lifetime jobs but that has now been dropped. As said before it is all cyclical and will come back around again.

 

Overseas, but on which planet? In late 2002 I went right from Ford dealer where a loaded escape was a firm $24,000 to a Honda dealer where a loaded CR-V ex was around $20,000. You could option up the CR-V to ALMOST $22,000. Three years and 45,000 trouble free miles later I traded it in on a 5 yr old Excursion that had lost 80% of its resale value (CR-V retained 85% of it's resale value!). Buy the Ford new and lose money at both ends? I don't think so.

 

US CRVs come from Japan or the UK. Beginning in 2006, they will come from Ohio. Maybe the CRV holds it's value better than an Expedition. I just read an article in the Dallas Morning News that a one year old Expedition is going for $20k at the wholesale market. Big SUVs have flooded the market due to high gas prices but it also stated they've leveled out with gas at $2 a gallon since people have short term memory.

Comparing the spouses Accord's value drop, it was the same as my old Escape. Personally, anything I drive at 35k+ per year is worth $2k when I'm done driving it (assuming I don't total it on livestock running across a dark farm-to-market road at 5am again). In January 05, I priced a CRV (not loaded) at over $24k and they would only budge a few hundred dollars. I bought the Escape for $19k. While it may hold it's value, it's hard for me to justify an extra $4k+ on something I'll drive into the dirt.

 

Yeah, well, in 2002/3 the SUV market was doing a whole heckuva lot better than in 2005, wasn't it? If Honda is that expensive now, it's because people want them. If the Ford is that cheap, it's because people dont. End of story.

 

I do believe that the Honda CRV is way over rated which has been confirmed by many car reviewers. In fact Honda will not let test results of crash tests of their vehicles be made public, they sued not to have the results made public. What does that tell you? It tells me that they are hiding something and/or that their vehicles are totally unsafe in a crash.
They are definetly not worth the high resale value that they are priced at. At some point when I was shopping around for used vehicle, some used Honda CRV's 2 or 3 years old were priced for what I could of bought a brand new Escape for! No way Jose.

One other thing, why support the economy of a foreign country when we our country needs all the support it can get in these times...

Honda, Toyota, Nissan and the rest of them can kiss my you know what...Buy American!

 

If it's not worth it, why do people (and car dealers!) pay so much for them?

Your "foreign country" argument is about 15 years out of date and you are quite ignorant about what domestic automakers build their cars with and where they build them. Read a newspaper/magazine and inform yourself.

 

Here, I'll help. Just a few examples.

Notice there is no difference between US and Canadian content. Are you Canadian, Tony?

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2005 Ford 500 Limited AWD 3.0v6 CVtran
USA Owned
USA Assembly- Chicago, IL
USA Engine
Germany Transmission
70% US/Canadian Parts Content

2005 Ford Ranger FX4 Off Road SC 4x4 4.0v6 5spd Auto OD
USA Owned
USA Assembly- St. Paul, MN
German Engine
France Transmission
80% US/Canadian Parts Content

2005 Ford Exlorer 4dr Limited 4x4 4.0v6 5spd Auto OD
USA Owned
USA Assembly- St. Louis, MO
German Engine
France Transmission
75% US/Canadian Parts Content

2005 Ford Exlorer Sport Trac XLS 4x2 4.0v6Flex 5spd Auto OD
USA Owned
USA Assembly- Louisville, KT
German Engine
France Transmission
70% US/Canadian Parts Content

2005 Ford Mustang V6 Coupe Deluxe 4.0v6 5spd Auto
USA Owned
USA Assembly- Flatrock, MI
German Engine
France Transmission
65% US/Canadian Parts Content

2005 Ford Focus ST Sedan 2.3 (i4?) 5spd Man
USA Owned
USA Assembly- Wayne, MI
Mexico Engine
Germany Transmission
60% US/Canadian Parts Content
15% Mexico Parts Content