Ford Plans $11.5 Billion in Extra Cuts, Killing Most US Cars

By Bloomberg – Re-Blogged From Newsmax

Ford Motor Co. is cleaving an additional $11.5 billion from spending plans and dropping several sedans, including the Fusion and Taurus, from its lineup to more quickly reach an elusive profit target.

The automaker is almost doubling a cost-cutting goal to $25.5 billion by 2022, Chief Financial Officer Bob Shanks told reporters Wednesday. By not investing in next generations of any car for North America except the Mustang, the company now anticipates it’ll reach an 8 percent profit margin by 2020, two years ahead of schedule.

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Corporate Average Fuel Economy (CAFE) Sux

By Willis Eschenbach – Re-Blogged From http://www.WattsUpWithThat.com

Bizarrely, and unlike almost every other industrialized country, the US has fuel efficiency standards for cars. Each corporation (Ford, Chevy, etc.) has to meet certain fuel economy standards called the CAFE standards.

Let me start by saying that I think that this is governmental over-reach. In virtually every other part of life we let the market decide the required efficiency. We don’t have required efficiencies for gas-fired power plants. More efficient plants occur as a result of the market. We also don’t have required efficiencies for cell phones. If they burn through the batteries, they don’t sell. The market has always handled efficiency quite … well … efficiently.

So I object to ANY automotive fuel standards as both totally un-necessary, and worse, market distorting.

Here’s one important way it distorts the market. “Fuel Economy” is measured in a very curious way. Work efficiencies are usually measured per pound or per kilogram moved. Efficiency would relate to how much energy it takes to move say a hundred kilograms a distance of 10 metres horizontally. If you can move the same weight at the same speed using less energy, you have a more efficient setup.

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