AU:Falcon drives Ford out of the red
Falcon drives Ford out of the red
By Ian Porter
The costly transformation of the awkward-looking AU Falcon into the current BA model has paid handsome dividends, with Ford Australia yesterday reporting a profit of $155 million for calendar 2003.
The strong profit ended an agonising five-year period during which revenues plummeted and the company slumped into the red.
The $500 million BA facelift -- which former president Geoff Polites pushed through even though it exceeded initial budgets -- transformed more than just the looks of the AU.
With the help of a record national vehicle market, it also produced sharp improvements in production volumes, sales and revenues in 2004.
Revenues in 2003 rocketed 22 percent from $3.23 billion to $3.92 billion as overall vehicle sales raced up 16 percent to a four-year high of 127,000 cars and trucks.
"Our increased vehicle sales were primarily a result of the popularity of the award-winning BA Falcon," newly-installed Ford president Tom Gorman said yesterday when releasing the result.
"More than 12,300 additional passenger vehicles were sold during 2003, bringing sales up to 89,500 from 73,200 the prior year."
Most of the extra passenger car sales were BA Falcons and its long-wheelbase derivatives, the Fairlane and LTD.
Ford also has another stellar year with its Falcon ute which maintained its status as category leader right through the traumatic AU period. In 2003, Ford lifted ute sales from 17,900 to 20,200 units, with many of them highly profitable specialist versions.
Another niche success was the 49 percent-owned Ford Performance Vehicles operation, which modifies some Falcon models into sophisticated sports and luxury models.
Ford's accounts show that its share of FPV's net profit almost trebled from $1.91 million to $5.77 million during 2003.
With the national new vehicle market still racing along at a record rate, Mr Gorman is confident of further improvement in financial results in 2004.
"Ford is poised to take advantage of the industry's momentum during the coming year."
While he is expecting improved sales following the launch of the four-cylinder Escape four-wheel drive and the European Fiesta small car, the biggest lift is expected to come from the Ford Territory, which goes on sale on June 1.
Mr Gorman said the Territory (pictured) -- another $500 million investment for Ford -- will be one of the most significant new vehicles ever for the company.
It was designed in response to changing market conditions, where buyers were drifting away from the traditional family car and wagon and into sport utility or crossover vehicles.
Ford's profit was struck after income tax payments of $49.6 million (previously a tax credit of $5.57 million). It represented a return of 26.1 percent on total shareholder equity of $592 million.
My first car was a 67 Mustang Coupe, 2nd one was a 67 Cougar XR-7, 3rd one was a 66 Mustang Coupe. Why did I get rid of these cars for ? I know why, because I'm stupid, stupid, stupid.
My next Ford.....