Ford Australia reports $24.9 million profit in 2010

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By Tim Beissmann | May 23rd, 2011

Ford Australia posted a $24.9 million after-tax profit in 2010 on the back of increased revenue of around $200 million.

The result was achieved despite a decrease in total vehicle sales in Australia and New Zealand – down from 99,279 units to 98,941. In 2009, Ford Australia recorded a more modest after-tax profit of $12.2 million.

The local manufacturer’s revenue grew from $3.1 billion to $3.3 billion in 2010, with its total cash rising $12 million to $232 million and its intercompany borrowings decreasing from $525 million to $475 million.

Ford Australia also received $116 million from Australian Securities & Investments Commission credits and invested more than $307 million into facilities, research and development for a range of local and global vehicle programs.

Ford Australia President and CEO, Bob Graziano, said the company’s second consecutive profit in a difficult economic environment was evidence that Ford Australia was making the right business decisions.

“We continue to invest significantly in our business, with a range of exciting new sustainability initiatives and new vehicles coming to market in 2011, all of which will attract more customers to the Ford brand,” Mr Graziano said.

“We are launching the critically acclaimed SZ Territory, have a refreshed Mondeo line-up and we are moving ahead with plans for the all-new Focus and Ranger pickup as well as Falcon EcoLPi and EcoBoost models.”

Ford sold 95,284 new vehicles in Australia and 3657 in New Zealand in 2010.

After four months in 2010, Ford has sold 29,178 vehicles in Australia, just 3.3 percent off 2010’s pace. The steady sales result has been achieved despite a significant drop in demand for Ford’s locally manufactured vehicles: Falcon (down 41.5 percent), Falcon Ute (down 29.7 percent) and Territory (down 18.3 percent).

Between January and April, Ford sold 10,957 locally manufactured vehicles in Australia, down from 16,694 in 2010.

Captain Nemo

Well done Ford now maybe you could spend some of that profit on advertising. But boy are the haters & resident trolls going to dislike this news.

Shane

Agreed, but funny that Ford are advertising their half yearly sales to the right of the screen next to all these comments.

But you are right…

BK

well done ford. You will be continuing beyond 2020 with the falcon

Me

…no they won’t.

Catter29

you are NUTS!

Lazybones

Apparently according to Ford we’ll find out this year. But from what i’m hearing its not good news. And with sales topping 1200 per month we shouldn’t been surprised.
Phil

BK, with what basis will Falcon continue beyond 2020? Sales are down 40% on last year, which in turn was 25% down on the previous year.
Ford was selling around 8000 Falcons a month in 2002. Now they are down to about 1500 a month and to get those 1500, Ford is having to discount each Falcon by $10,000 -$15,000 (and even more for the fleet sales).
Ford also currently has a stockpile of over 2000 unsold Falcons sitting on the grass around the factory as well as full dealer holding yards all around the country.

Frostie

So what if the Falcon’s sales are down. Ford will just get up and get going again like they used to. They have funds for advertising and Research & Development now.

Stoney!

LOLOLOLOLOL thats a good one!

Homer

All of which was taxpayer funded!

Wizzy

Their talking about Ford, not Holden.

F1MotoGP

I am sure Falcon did not make much profit. The new Focus will be a nice boost to Ford profit. Please spend the profit on improving the fuel economy. We do not need any bigger cars but more fuel efficient one.

Roadtard

Sales of gas guzzling 4WD/SUV’s suggests Falcodore fuel economy isn’t an issue.
FalComAuri

Roadtard is correct

The old “they use too much fuel” winge again

Its a perpetual lie that keeps going around

Owoteva

I think it has more to do with relevance than fuel economy (though that would play a part). Many people don’t need a large car anymore when a small-midsize (which could be bigger than a large car from about 10 years ago) would likely suit better. Families are looking for space are heading to midsize SUVs or even large SUVs if they need to fit 3 abreast comfortably or for 7 seats(and could also tow a boat easily)

Phil

Most of the 4WDs models that are actually selling are diesel models which use far less fuel than Falcon.

Landcruiser Prado for instance uses 8.5L\100km which is about 20% lower than Falcon.

The only 4WDs that sell well in petrol form are the likes of CRV/Xtrail/Forester and these too use less fuel than Falcon.

bangel

I see they have 3000 plus falcoons lying in the grass in broard meadows , no thanks .

Reminds me of the mitsu 380 story all over again , the clock is ticking down.

Captain Nemo

And right on queue the resident CA troll shows up.

Maybe you could ask your local council to put some sort of heating under your bridge so you can spend less time on CA and more time @ home.

Oh BTW “Broadmeadows is one word hey champ.

Naughtyius Maximus

Did not know the world revolves around your diatribe diehard belief!
Phil

Nemo, why don’t you address the specific topic at hand instead of going off on a mindless personal tangent?

Ford does indeed has thousands of Falcons sitting in the grass around their factory unable to find buyers. They has also annouced they are cutting about 250 jobs and trimming production output.

paulb

Great result,with new models coming up.Sales and profits will boom in the next couple of years.Dont forget the money spent on all the r+d in the new models coming.
Alex

I don’t know how many times it has to be said but fuel coast are not the most expensive part of owning a car. Depreciation is, and most people (private buyers) never think of that. Sucks to be spending $30K to save $20 a week on fuel. When will people learn. If you can afford a new car, you can afford to put fuel in it. End of story.

Falcon sales a low because they offer nothing but 5 large seats. 20 years ago this was good, now you have 20 competitors with 7 large seats for teh same money. And they hold their value more. So fuel savings is useless to the Falcon where the biggest cost is in three years time when you find out the car has cost your $10K a year in depreciation… makes the fuel bill look cheap now doesn’t it?

Captain Nemo

Alex i wouldn’t say Falcon’s competiors have 7 large seats most have 5 large & 2 kiddie seats.
bangel

Wrong car in todays climate thats also why the crummer is down to 3000 a month , compared to 8000 month 10 years ago .

Biggest problem is they cant shift the excess at any price , not so good for depreciation if you bought one a year ago .

TMG

First well done Ford for turning a profit, and investing millions in local R’n'D,

Second last year you could buy a Falcon cheaper then you can now, with a lot of extra free kit

Third to all the naysayers the Falcon may be short for this world or it may not be, we don’t know yet, but we know Ford will still be manufacturing in OZ for quite some time.

So instead of the death by a thousand cuts which happened to Mitz, perhaps we should all just be happy that a company wants to manufacture a range of vehicles (Ute, Sedan, SUV and performance sedan) specifically for Oz conditions in a marketplace that’s no bigger than the amount of Focus’s or Golf’s sold in Europe each year.
chook

Depreciation is irrelevant if we keep the falcon for 10 years or more , because by then any car is worth near nothing .

paulb

chook,i heard a major car salesman say that the other day.Nothing 10 years old is worth anything now.Interesting used car salesman love the BA Falcon $7000 to $8000.

bold

a few things I can think of,

1, what is wrong with falcon? why commodore can sell while falcon can’t

2, small ford cars are making at least the same profit as what falcons used to bring to ford

3, can we get better ford compact suvs, like kuga, if falcon is not selling, people don’t hate ford, they just don’t like one or two models from ford

4, if it is proven fuel consumption is not an issue, then it is bad news for falcon because more people are going for suvs consume same amount of fuel.

Phil

Impractical. Falcon is huge on the outside, yet the bootspace is barely any larger than a Honda City. There no wagon option at all. They also ditched the 6th seat bench option and the extra two rear seats that you used to be able to option in the wagon. So it fails as a family car.

It weighs between 1750-1900Kgs which is far too heavy for a sports car. So it fails as a sports car.

The most fuel efficient version burns 9.9L\100km, it emits about 230grams Co2 and it only just meets Euro 4. So it fails as a green car and as a cheap run about.

Common

Its not impractical,it carries three across the back seat better then a Honda City.

It can tow,some familys need to tow,there also the best car traveling long distances.Safer and more fuel efficient then a 4wd,more power and torque than a Honda city,Handles secondary contry roads better than a VW golf.

As for impractiacl family cars,No 1 is large,heavy,thirsty,dynamically inferior 4wd’s in the city and freeway.

Most if not all large 4 door sedans in the world that are that heavy or heavier and its not trying to be a sports car,its a family car with muscle car variants.

The Falcons fuel consumption figure is totally relevat to its engine size,compared to other size engines of any make.

Phil

People don’t need to or want to carry 3 across one back seat. How often do you see 3 people sitting across a back seat?

Very few people want to tow. Most Falcons do not even have a tow bar fitted. Most of the time when you see a car towing, its either a Ute or 4WD.

What makes them the best car for long distances? They have no special features that make them better than any other car.

Most 4WDs are diesels and have better fuel econmomy than Falcon

Most people don’t want more power and torque.

The Falcons fuel consumption may be relevant to its size engine and those of any make, but the power output is not. Most other makes are getting more power from smaller engines with better fuel economy. ie, Audi A7 3.0 TSI 220KW/440NM with a 8.2L\100km rating – no doubt you will complain its too expensiuve, but you said “any make”.

nobody

I don’t trust the ford oz Accountant!
http://www.caradvice.com.au Jim Goose

Another profit? Must be moving a few Mondeos and focus’s! Its good news.I hope the new Terry and Falcon find their feet…..but I’m not overly confident. Fingers crossed.
Roger Ramjet

The Falcon sales have been down from the non-availability of the:
-Wagon
-Lpg
-XR8

The Mondeo sales are up because the Mondeo wagon has now found a niche left by the Falcon wagon.

chook

Agreed Roger……but a pity that even the media cant understand this simple logic !!

Phil

That’s because the media can count.

Wagon, LPG and XR8 did not account for 40% of sales in the last decade. Also even when they had all those models selling together, sales were still declining.

TMG

Going off memory,(well what Ford used to publish to the dealership I worked for) The LPG vehicles made up about 25% (Ute and sedans)of Falcons sold, The wagon added about 500 vehiles a month on average (inc LPG 2008) and the XR8 was about 100-150 a month (ute and sedan), add RTV and Fairlane-LTD sales of about 100 month, and thats whats missing.
LPG sales in 2009 where greater again.

Phil

Even if that were true, how do you explain the decline of sales BEFORE those models were removed from the line up?

Sales have been in continual decline since 2002, but XR8, wagon and LPG were only removed last year.

Please explain the decline from 2002 – 2010 (Ford went from about 8000 sales a month in 2002 to about 2400 a month in 2010).
Phil

Actually XR8 was removed earlier than last year but since it supposedly accounted for only 100-150 sales a month, it won’t make much difference anyway.

chook

Its fair to say that many LPG falcon buyers are holding off till the new one is released soon . I think we all know that when any maker has a new range of updates coming then many buyers hold off till later .

troy

ford cant blame the market for the demise of the falcon, blame themselves.

they give no rats @$$ for it, they are making money from every other car that they sell ( AND advertise ) why bother with the brilliant falcon, why tell everyone how good it is?
RIP Ford

You need to make alot more than that piddle amount
This would hardly pay for morning tea for a year
RIP Ford

Andrew M

Actually, to determine your profit first you must subtract your morning tea expenses and all other costs for operating in that year.

Do you know what “profit” is?

Jono

So a $24.9 Mil profit, but how much money do they get from taxpayers just to stay open?

Phil

Well the article mentions they got $116 Million from the Australian investment commission.
Plus they get a large share of the $500 “Million green car innovation fund”.
They also get a share of the $5.4 “Billion Automotive transformation scheme”.

These are all Federal funds. They also get occasional donations from state governments too.

Car Fanatic

At least they made profit, I’m not a big Ford Fan but it’s good to see them have success regardless of where there money came from.

Then again, Holden and Toyota received government funding, don’t see anyone in here bitching about that!
Shak

Credit where Credit is due. Good Job Ford, look forward to your producing good cars long into the future to sustain the Local industry.
Mikko

Congratulations.

It’s just too bad that it’s not the locally made ones that are selling.

They’ve got to make the Focus, Fiesta and Mondeo here.

Phil

Why when its cheaper to import them?

Shane

What people don’t understand is the recent low numbers are due to no LPG and the territory being delayed. The LPG is a big seller for Ford especially for the fleets and the utes. Once the new Eco LPI, Ecoboost and new Territory are into full swing, the sales will pick up to more average numbers.

However I honestly think the Falcon will not be the same vehicle in 5-10 years time. It will either be imported with “Aussie Touches” made to the exterior or it may share the mustang RWD platform which will not be too bad as it would save Ford Aus lots of $$$. But I think the I6 will go and the Falcon will be available with the ecoboost 4T, a US sourced V6 and the V8.

If your a car enthusiast, I think now is the time to buy a Falcon as the current engine offerings will never been seen again, the 6T is a great engine, and the new S/C V8…unbelievable which is why i’m buying one very soon.

Phil

Falcon LPGs accounted for about 10% but sales are down 40% on last year. Also very few fleets buy LPG. There may be a slight increase in sales once the LPG and ecoboot arrive, however sales will still be below those on recent years.
You are right about the Falcon’s future, it will be a imported vehicle – or Ford will decided not to have a large vehicle at all. Mitsibishi never replaced the 380 and their local sales are still the same.

Andrew M

Dunno where you look for your figures, but E-Gas accounted for 25-30% of sales, the ratio has also been on the climb
chook

Phil…..your numbers are wrong, and everyone here agrees . E-gas falcons do definitely count for atleast 25% ,and XR8 is less than 5% or so. The main reductions were from the loss of the wagon and fairlane /LTD .

chook

There are buyers waiting for the new Egas , new XR8 and ecoboost . Pity Ford dont include Egas on XR8 and XR6T , same as what HSV made available not long ago .My last comment should have read ……XR8 sales 5% or so .
Phil

chook and Andrew M,

Please then explain the decline of Falcon sales BEFORE they removed LPG.

LPG was only removed last year along with the wagon. Yet when Wagon and LPG were still on the market last year they were only managing about 2400 sales a month. Back in 2002 they were managing 8000 sales a month and since 2002, they have had a constant decline in sales. Perhaps the rate of decline increased with LPG gone, but based on the figures, it would’ve declined with or without LPG right anyway.

Robert

They didn’t have a wagon with the FG did they? that got introduced in 2008
Phil

No FG wagon, Ford couldn’t be bothered. Instead they continued making the BF wagon alongside the FG sedans. They stopped that last year.

bangel

Correct the large car market has slumped dramatically over the last decade and will continue to , even the mid size sales are slow .

Smaller families , cost of rego , insurance , fuel , it all adds up , and people are taking flying holidays more than ever with cheap flights , dont take the car , only need a small one for commuting , and if you are in the grey army , who the hell buys a crummer or a falcoon for towing , have not seen one for years towing a van or boat , all holidaying in a 4WD diesel .

Face it the old family 6 from the past is dead , RIP .

The Realist

Wonder what the numbers are when you take away ALL tax payer subsidies…

Phil

Would also be interesting to see the numbers after the Australian manufacturing portion was taken out. This portion would not be profitable. Service departments and selling imported models should be profitable.

troy

toyota doesnt need marketing, old people buy them anyway!

ford with half of holdens marketing would kick ass….
Homer

Toyota spent $85m in 2009 on marketing. More than 3 times the Ford net profit above.