How much does it cost to build a Falcon

[Dave_au]

Originally Posted by tranquilized

its impossible to calculate total unit cost until the model run has been completed Its not even worth speculating on.

Not quite, there would already be a cost allocation for each model of Falcon, along with the calculation of the amortisation of grants and R&D based upon production scheduling. They would be amortising these at a realistic rate over the expected lifetime of the product cycle, or the grant.

[GT0132]

Originally Posted by Eaturbo

Do you know anything else that has stayed the same price for 10 years or more.

Hi Fi Equipment, TV's & Cameras

[Gobes32]

Originally Posted by Luke Plaizier

Everything in this thread is based on conjecture and guesswork. Anyone bold (or arrogant) enough to say that someone else is wrong is simply wrong themselves.


Lukeyson

I think you will find that people who really do know the answer have already spoken, and I am not one of them.

[smally289]

There would be a room full of shiny bum bean counters that had projected all the costs involved in R&D, manufacture, product support and warranty for each model. The real dollar figure per vehicle cannot truly be calculated until that model has ceased production and then served out their warranty period.

[Fordman1]

Originally Posted by 4Vman

there would be 8K in driveline and suspension buy ins alone...

Yes there would...........

[blueluvr]

Interesting thread.


On the topic of "write offs" it reminded me of this funny skit, I think it fits in well here ATM

http://www.youtube.com/watch?v=rCZRqH7sRyA

[BFYOOT]

not sure how accurate it is coming 2nd hand, but i treated a fella about 5yrs ago whos son worked in the holden manufacturing side of things. he said (not including the extras, R&D etc) a commodore cost between 3500 and 5000 to build. assuming the rising cost of items, thatd be pretty close to the 6-8k suggested.

[Fordman1]

Originally Posted by BFYOOT

not sure how accurate it is coming 2nd hand, but i treated a fella about 5yrs ago whos son worked in the holden manufacturing side of things. he said (not including the extras, R&D etc) a commodore cost between 3500 and 5000 to build. assuming the rising cost of items, thatd be pretty close to the 6-8k suggested.

Like it or not, tooling, plant setup, designing manufacturing processes, and development ARE part of the cost of building a car............ period.

Other costs such as logistics costs', freight, utilities, etc, all need to be considered also.. otherwise how do you 'run' your plant ?

Building a car is more than just the material cost......

The alternative to the facts above are hand made components created in a big empty shed - then you are 'up for' many thousands of dollars for one automobile that meets all criteria, including ADR's, safety requirements (both legal and corporate standards), etc.

It's not really as simple as some make it out to be...

Anyone that has run a medium sized business will agree.

'Total cost' is what it is all about.

[4Vman]

Originally Posted by Barraxr8

Like it or not, tooling, plant setup, designing manufacturing processes, and development ARE part of the cost of building a car............ period.

Other costs such as logistics costs', freight, utilities, etc, all need to be considered also.. otherwise how do you 'run' your plant ?

Building a car is more than just the material cost......

The alternative to the facts above are hand made components created in a big empty shed - then you are 'up for' many thousands of dollars for one automobile that meets all criteria, including ADR's, safety requirements (both legal and corporate standards), etc.

It's not really as simple as some make it out to be...

Anyone that has run a medium sized business will agree.

'Total cost' is what it is all about.

Absolutely... anyone who thinks it costs 8K to build a base model falcon is dreaming.... if it did Ford would be posting massive profits..
If, as an example it cost in total 100mil to run your business, including all operational costs, depreciation, plant, leases, wages materials etc etc at break even for 12 months and you've built 4500 "gidgets" it COST $22,222.22 to make each gidget to break even..... If you built 5000 gidgets it COST $20,000.00 to make each gidget to break even...

[gtfpv]

Originally Posted by 4Vman

Absolutely... anyone who thinks it costs 8K to build a base model falcon is dreaming.... if it did Ford would be posting massive profits..
If, as an example it cost in total 100mil to run your business, including all operational costs, depreciation, plant, leases, wages materials etc etc at break even for 12 months and you've built 4500 "gidgets" it COST $22,222.22 to make each gidget to break even..... If you built 5000 gidgets it COST $20,000.00 to make each gidget to break even...

hence the reasons sales numbers are critical to keep a company floating or going bust. perhaps a more logical question would be how many falcons do ford need to sell, before they make a profit ?? looking further into it , profits from previous models need to go into R&D for the next model. looking at the answer before the question would enable price setting beforehand .

[4Vman]

Originally Posted by gtfpv

hence the reasons sales numbers are critical to keep a company floating or going bust. perhaps a more logical question would be how many falcons do ford need to sell, before they make a profit ?? looking further into it , profits from previous models need to go into R&D for the next model. looking at the answer before the question would enable price setting beforehand .

That's true to a point.. but if you keep selling them below cost it wont matter how many you build or sell.
The other thing we need to consider is efficiency break points for production and the line.. sometimes more is not always better, especially if it creates allot of overtime and penalties..

[ls f6]

Originally Posted by FPV+fteT3

FYI: They have great accountants and probably get paid a bonus for each year they dont show a profit on the books this doesn't mean they dont make money. Losses on paper thru depreciation,amoritisation,GST,R&D etc all companies minimise and claim all they are entitled to and FOA would be no different.

You are confusing the motives of small business owners versus publicly listed companies, which are very different.

Ford Australia exists solely to add to the bottom line profit of its corporate parent, Ford Motor Co (USA).

Ford Motor Co's management and directors, when it comes down to it, are measured on one thing by their shareholders - ie the profit they report (higher reported current profit and projected future profits = share price appreciation and dividends for their shareholders).

There is no vested interest for a publicly listed company (such as Ford Australia via Ford Motor Co) to minimise their reported profit.

[4Vman]

Originally Posted by ls f6

You are confusing the motives of small business owners versus publicly listed companies, which are very different.

Ford Australia exists solely to add to the bottom line profit of its corporate parent, Ford Motor Co (USA).

Ford Motor Co's directors, when it comes down to it, are measured on one thing by their shareholders - ie the profit they report (higher reported current profit and projected future profits = share price appreciation and dividends for their shareholders).

There is no vested interest for a publicly listed company (such as Ford Australia via Ford Motor Co) to minimise their reported profit.

That, is a very astute observation....

[Bossxr8]

Originally Posted by gtfpv

hence the reasons sales numbers are critical to keep a company floating or going bust. perhaps a more logical question would be how many falcons do ford need to sell, before they make a profit ?? looking further into it , profits from previous models need to go into R&D for the next model. looking at the answer before the question would enable price setting beforehand .

When the FG was released Ford claimed 3500 per month would make them solidly profitable. They currently sell around 2800 per month, but remembering that employee numbers and costs would have been reduced since then, and they are selling a lot more higher end models which are more profitable, then you could probably reduce those original numbers a bit. Maybe 3000-3200 a month?

At the current rate they probably won't be losing much money, with a bit more cost savings and a few more sales they should at least break even.

And for all those people who want to know how much the FG's development cost, it was around $800 million. I don't know why some people keep saying $500 mil. The AU to BA cost 500, 5 years later with 95% of the car all new there is no way in hell they could have done it for 500. It was even noted by Ford that if Holden didn't spend something like $150 million on the Statesman/Caprice then Ford would have spent about the same as Holden did with the VE.

[4Vman]

Originally Posted by Bossxr8

When the FG was released Ford claimed 3500 per month would make them solidly profitable. They currently sell around 2800 per month, but remembering that employee numbers and costs would have been reduced since then, and they are selling a lot more higher end models which are more profitable, then you could probably reduce those original numbers a bit. Maybe 3000-3200 a month?

At the current rate they probably won't be losing much money, with a bit more cost savings and a few more sales they should at least break even.

And for all those people who want to know how much the FG's development cost, it was around $800 million. I don't know why some people keep saying $500 mil. The AU to BA cost 500, 5 years later with 95% of the car all new there is no way in hell they could have done it for 500. It was even noted by Ford that if Holden didn't spend something like $150 million on the Statesman/Caprice then Ford would have spent about the same as Holden did with the VE.

@ 800 mil if they amortize that over 4 years that equates to roughly $5K per car than add interest.... That's before anyone grabs a spanner or stamps a panel.....

[blueluvr]

Forget how much they cost for a minute, to "develop" the FG series costs 800 mil? How different is it that it costs that much to "develop? Same engine driveline, so The only things being "developed" is the chassis and bodywork really.......no?

What am I missing here? And before that 500 mill to "develop" the B series? And they still couldn't get the fuel pump and diff bush right after spending 500 mill? No wonder they are in the clacker

[G6ET8U]

Good thread and a very interesting read... Ohio XB as always you post some very interesting stuff.

I have no doubt that it cost less than 10k to build the car. I also have no doubt that it ACTUALLY cost somewhere near or more than 30k to sell it.

It is one thing to build something it is a complete other thing to build and sell it in volume.

And for those that are hating the UAW in the US. If you were there you would've voted for it and taken it at the same time too. If it was offered to you in a wage negotiation you would also take it, so stop bitching about. As Ohio has said Toyota has the same agreement without the volume claiming it... yet.

[Bossxr8]

Originally Posted by blueluvr

Forget how much they cost for a minute, to "develop" the FG series costs 800 mil? How different is it that it costs that much to "develop? Same engine driveline, so The only things being "developed" is the chassis and bodywork really.......no?

What am I missing here? And before that 500 mill to "develop" the B series? And they still couldn't get the fuel pump and diff bush right after spending 500 mill? No wonder they are in the clacker

Upgraded engines, brand new manual gearbox, brand new front suspension and steering, and every panel from the boot floor up and forward of the diff, new electricals, dash, instruments, interior panels etc. Do you seriously think they could do all that for, oh about three fiddy? :

[blueluvr]

Oh I'm sorry, I don't happen to know, which is why I asked the question......3 bucks fiddy...... :rolleyes: So do you think that the figure of 800 mil for the FG is cheap or on par?

I'm not saying it didn't cost that much, but a breakdown would be interesting to see.

Although I would say my diff bush and swirl pot in my BF got only 3fiddys worth of the development fund :

[Chopped]

Who knows for sure.

They make the least profit on the base models (XT, Omega etc).

They make their "cream" from the higher/sporty spec models. (Stripes cost SFA to produce but add lots to the RRP!)