We’d like to remind Forumites to please avoid political debate on the Forum.
This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
The Forum now has a brand new text editor, adding a bunch of handy features to use when creating posts. Read more in our how-to guide
Ford increasing prices again:
Comments
-
Going to break the habit of a lifetime and agree 100% with Lemonade (no ifs, buts, wriggle room exceptions nada)
Ford of Europe have been losing money consistently for years.
The numbers you mention of a hundred million are as lemonade says more down to the accountants than proper automotive profit.
If you look at the value and size of these companies the number of people they employ directly and indirectly the numbers anounced as profit is less than .5% of turnover.
No self respecting businessman would get out of bed in the morning for those numbers and the share price shows this to be true as well.
Ford have been leaking money for years in Europe - One of the guys I worked with there once said its like a leaky ballon with a lot of holes. The only difference is Fords balloon was a lot bigger and had a lot more spare air than GMs. (Replace the word air with cash reserves and you get the idea)
The other thing to remember is in the UK where Ford lead the other volume manufacturers tend to follow so my guess is that these price rises will be at more than one manufacturer.
Would also like to pick up the point about a 2.5% rise being not that much.
If you add it to the other 4 or 5 price rises in last 18 months it equates to about 15% on some models.
Part of me wonders if this is tactical prior to scrappage ending to make their post scrappage deals look a lot stronger.
Sounds silly but Ford did exactly the same thing PRE scrappage.
The marketing and sales guys call the shots at Ford UK and this is the kind of strategic decision they would make.
Wouldnt surprise me if this topic was started by someone there.
Not saying it is OP but I know from personal experience that we used to do stuff like that.
Ford Credit figures tended to be included but seperatelly as a division within their own right. Syou would have Ford Motor Europe, FCE, VAG in lovely bar charts with VAG often split (at the request of volvo who were the only one of the three making profit at that time).0 -
Course there isn't. No revisions to prices of components shipped internationally from one plant to another. None whatsoever. Honest. Totally true. :rolleyes:Lemonade_Pockets wrote: »...(there is no "cross charging as you refer to it because ford would lose at least 59% of it so it would be pointless)
If Ford was not making & selling cars (& other vehicles), it wouldn't have a business let alone any profit ... negative or positive.Lemonade_Pockets wrote: »If i can find the info is publicly available on the net i'll send you a link but i promise you Ford is currently not making money out of its core business which is producing and selling Car's. Hence my original points."Now to trolling as a concept. .... Personally, I've always found it a little sad that people choose to spend such a large proportion of their lives in this way but they do, and we have to deal with it." - MSE Forum Manager 6th July 20100 -
So the company's financial statements are wrong are they?...Ford of Europe have been losing money consistently for years. ...
So Mr Lewis Booth has no self respect?...No self respecting businessman would get out of bed in the morning for those numbers ...
Your opinion, and you of course are entitled to it, but I doubt Mr Booth agrees with it and neither do the huge majority of business people employed in the automotive industry where he is well known and respected."Now to trolling as a concept. .... Personally, I've always found it a little sad that people choose to spend such a large proportion of their lives in this way but they do, and we have to deal with it." - MSE Forum Manager 6th July 20100 -
Financial statements can be written and read however the company wishes them to within coporate guidelines. You should see the share packs I get through from Ford and Visteon showing this figure and that figure.
Whats important is what the press reports. Accountants can turn the billions of loans Ford Credit has into and asset or a liabilty depending on how you look at it. BP's valuation is based on the value of black stuff in a hole in the ground.
Fords valuation of its own unsold stock on the ground moving by a percent or 2 can mean the difference between a loss or a profit.0 -
Course there isn't. No revisions to prices of components shipped internationally from one plant to another. None whatsoever. Honest. Totally true. :rolleyes:
If Ford was not making & selling cars (& other vehicles), it wouldn't have a business let alone any profit ... negative or positive.
On the first point your confusing two different issues. Transfer pricing can as you say theoretically re-distribute wealth. However i'm saying in the cases of the entities mentioned it is not beneficial for ford to transfer that wealth to them as they do not own them 100%
Even if they wanted to for some madcap reason i think the local tax authorities would have something to say if they tried. No-body wants a arms length transfer pricing agreement to be imposed.
On your second point we are moving away from the original subject of this discussion. Ford could be making billions and billions out of a share in another operation, but until they start making money out of producing and selling cars don't expect a decrease in prices or anyone else for that matter. It is purely robbing peter to pay paul and not a sound basis for business.
I will gladly be humbled and eat my proverbial hat if MFR's start decreasing list prices next year. However for what my opinion is worth as an armchair pundit i don't think they will.0 -
Of course it is. The Sun & the Express ... can't beat 'em (although the Star is the usually the best, but not much in there monetrywise apart from its own price on page 1) :rolleyes:...
Whats important is what the press reports. ...
Not to be confused with Katie Price on page 3
"Now to trolling as a concept. .... Personally, I've always found it a little sad that people choose to spend such a large proportion of their lives in this way but they do, and we have to deal with it." - MSE Forum Manager 6th July 20100 -
-
You mentioned the entities not 100% owned, not me.Lemonade_Pockets wrote: »On the first point your confusing two different issues. Transfer pricing can as you say theoretically re-distribute wealth. However i'm saying in the cases of the entities mentioned it is not beneficial for ford to transfer that wealth to them as they do not own them 100%
It happens. Ford employ many financial analysts to do just that.Lemonade_Pockets wrote: »Even if they wanted to for some madcap reason i think the local tax authorities would have something to say if they tried. No-body wants a arms length transfer pricing agreement to be imposed.
Of course, if they take the mickey they'll be found out, but just how much is a drive shaft worth? $20 or $30? The taxman is certainly no automotive component cost estimator. Even if he were, the amount of mark up the company may or may not wish to apply is up to them.
I can almost guarantee they won't reduce list prices. Why would they, especially when they have the biggest selling car in the UK, are the biggest car manufacturing brand in the UK and are maintaining market share? Oh, and turning a profit too.Lemonade_Pockets wrote: »On your second point we are moving away from the original subject of this discussion. Ford could be making billions and billions out of a share in another operation, but until they start making money out of producing and selling cars don't expect a decrease in prices or anyone else for that matter.
I will gladly be humbled and eat my proverbial hat if MFR's start decreasing list prices next year. However for what my opinion is worth as an armchair pundit i don't think they will.
http://www.confused.com/featured-articles/motoring/car-insurance/the-best-selling-car-brands-in-the-uk-3287012318"Now to trolling as a concept. .... Personally, I've always found it a little sad that people choose to spend such a large proportion of their lives in this way but they do, and we have to deal with it." - MSE Forum Manager 6th July 20100 -
You mentioned the entities not 100% owned, not me.
It happens. Ford employ many financial analysts to do just that.
Of course, if they take the mickey they'll be found out, but just how much is a drive shaft worth? $20 or $30? The taxman is certainly no automotive component cost estimator. Even if he were, the amount of mark up the company may or may not wish to apply is up to them.
Do i have to draw you a bl00dy picture. I thought since you bought this issue you up you might understand it but apparently not, just throwing half baked ideas around.
In this scenario company A could be Ford.
Company A sells components to Company B
Company A owns a 40% share in company B.
If company A sells parts cheap to Company B Lets say for £10 less than it should do Company A loses out on £6!!!!!!!
No one is debating that they are turning a profit try and read what i've been saying. However fundamentally the business plan for 90% of manufacturers is flawed at the moment. There is too much competition, the volumes are too high and the profit to low or non exsistent. I believe (and i'm in a position to make a reasonably informed opinion) that prices will not drop.Oh, and turning a profit too.
MFR's will cut production, capacity and jobs. Supply and demand will therefore balance out. Already across the industry for example inventories are the lowest they've been for years and years (before anyone chips in that was the case before the scrappage too).0 -
As I said, you introduced the notion of plants not fully owned by parent company.Lemonade_Pockets wrote: »Do i have to draw you a bl00dy picture. I thought since you bought this issue you up you might understand it but apparently not, just throwing half baked ideas around.
In this scenario company A could be Ford.
Company A sells components to Company B
Company A owns a 40% share in company B.
If company A sells parts cheap to Company B Lets say for £10 less than it should do Company A loses out on £6!!!!!!!
Look at the scenario where both plants are owned 100% by parent company.
Plant A is in country X and produces widgets that cost $50 to produce.
Country X has corporation tax set 60%
If plant A sells widgets at $150 then it pays $60 in corpration tax
If plant A sells widgets @ $50, there is no corporporation tax as no profit is made
Plant B is in country Y and is a customer of widgets.
Country Y has inport tax at say 10% and corporation tax at 30%
If plant B buys @ $150, it will pay $15 import tax.
So Parent company pays a total of $75 tax
However if Plant B buys at $50 and sells at $150, the plant only pays $30 corporation tax plus $5 import tax.
Total tax cost to parent company = $35
Despite the profit before tax in both cases being $100
Don't you believe major companies take advantage of this and employ people to maximise this effect (within the boundaries of what is not seen as taking the mickey)?Lemonade_Pockets wrote: »..No one is debating that they are turning a profit try and read what i've been saying. ...
You could have fooled me! :rolleyes:Lemonade_Pockets wrote: »...2) Ford of Europe are not yet making a profit out of selling cars......Ford of Europe have been losing money consistently for years. .."Now to trolling as a concept. .... Personally, I've always found it a little sad that people choose to spend such a large proportion of their lives in this way but they do, and we have to deal with it." - MSE Forum Manager 6th July 20100
This discussion has been closed.
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 353.6K Banking & Borrowing
- 254.2K Reduce Debt & Boost Income
- 455.1K Spending & Discounts
- 246.6K Work, Benefits & Business
- 603K Mortgages, Homes & Bills
- 178.1K Life & Family
- 260.6K Travel & Transport
- 1.5M Hobbies & Leisure
- 16K Discuss & Feedback
- 37.7K Read-Only Boards