AD #2766 – Ford 2019 Earnings Abysmal; Cadillac Reveals All-New Escalade; Kia Unveils New Sonet SUV

February 5th, 2020 at 11:54am

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Listen to “AD #2766 – Ford 2019 Earnings Abysmal; Cadillac Reveals All-New Escalade; Kia Unveils New SUV” on Spreaker.

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Runtime: 10:01

0:07 Ford 2019 Earnings Abysmal
0:50 Cadillac Reveals All-New Escalade
2:15 Kia Unveils New SUV
3:13 Britain Bans ICE Vehicles By 2035
3:54 Musk’s Tesla Stock Worth $30 Billion
4:36 Musk Hints at Texas Gigafactory
5:06 BMW Creates Aerodynamic Wheels for EVs
6:46 GM 2019 Earnings Surprisingly Good
7:38 Ford Blames Poor Earnings on Operational Execution
8:54 Hackett Could Be on His Way Out

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57 Comments to “AD #2766 – Ford 2019 Earnings Abysmal; Cadillac Reveals All-New Escalade; Kia Unveils New Sonet SUV”

  1. Larry D. Says:

    Great show today, Sean and John, and lots to comment on.

    A. Ford Dismal Earnings: The regulars here know I was always very critical of Hackett and his decisions, but recently I was thinking that by eliminating all the $ losing sedans and selling only profitable SUVs and F150s, they should do well in Profits, despite the lower market share.

    If you look at your detailed results in your link, it says

    “The company reported a Q4 net loss of $1.7 billion, or negative 42cents per share, which includes a previously disclosed $2.2 billion pension and OPEB remeasurement loss..”

    So it seems the loss in Q4 was actually a GAIN of 500 million $, if they did not add this one-time loss or accounting trick or whatever it is.

    Still, I think Hackett is clueless and if Ford continues to waste its profits on billions of $ of AV and mobility pipe dreams, it will have really serious financial troubles later.

    B. The new Escalade. I looked up its specs, and was pleased to see they did not use their 1.2 liter 3 cylinder with four turbos and eight superchargers, but the allegedly new old relaxed 6.2 lt V8.

    The dimensions, esp of the ESV, are great, 120-134″ wheelbase, and almost 230″ length, ample width and height etc. GM claims huge interior space increases over the prior model, but I don’t have both model’s dimensions to see why.

    ” 40 percent more third-row legroom (34.9 inches / 886 mm) and a 68 percent increase in maximum cargo space behind the third row (25.5 cubic feet / 722 liters) in the standard-length model.”

    C. GM earnings are NOT surprisingly good, I expected them to be good, because, unlike everybody in the press, I and others here saw that the strike was a HUGE benefit and NOT a loss to GM. First of all, for 40 days it saved BILLIONS in Worker salaries. Second, it trimmed its bloated inventories AND was able to sell its vehicles with fewer INCENTIVES, ie, with MORE PROFIT. And on and on. I even suggested to the UAW to strike again, in all automakers. Their shareholders will be grateful.

  2. Lambo2015 Says:

    Sounds like Ford should offer Hackett an early retirement since it appears he has already checked out.

    Britain ending the sale of ICE’s by 2035 is different than banning them altogether. So by 2045 there will be lots of people holding on to their older ICE cars.

    As for the 80% in favor of Tesla building a giga factory in Texas. The 20% against it are the ones that probably don’t want anymore Californians moving to their state with their liberal agenda and provide everything for free mentality. Supporting link; https://www.msn.com/en-us/money/markets/why-texans-dont-want-any-more-californians/ar-BBZvKtf
    However if they build a plant it would likely mean jobs for Texans so you would think they would all favor a new plant.

  3. Kate McLeod Says:

    Yup. No exaggeration there. That’s dismal.

  4. Lambo2015 Says:

    BMW wheel; Really surprised they could get an extra 6 miles of range by a newly designed wheel. How much can be contributed to the shape and how much was the lower weight? Pretty impressive tho! Wonder how the old smoothie wheels would do?
    Make a new Kevlar smoothie wheel and see how that does.

  5. Brett Cammack Says:

    I see Ford has a new 7.3 liter *pushrod* V8 available for the Super Duty pickups. Being cam-in-block, it’s pretty diminutive compared to the OHC engines. Someone’s already put one in a Fox-body Mustang with little or no surgery.

    Apparently it is “built to the hilt” with 6-bolt mains, forged crank and rods. Hot rodders are saying it should be good for 600 HP with little effort or risk of damage.

    Makes me want to go find another 2003 Crown Victoria LX Sport and put one in it. :)

  6. Larry D. Says:

    DOn’t know why Musk is asking the clueless web about a Texas GF. If he has done his homework and there is a need for cars and batteries that will be sold in the US and NOT exported, I say YES. If they will not have enough US demand and will be exported, better build it in the region it will sell them, and avoid nasty tariffs and transport costs.

  7. Brett Cammack Says:

    That BMW concept sporting the wheels makes me wonder when Kia is going to sue BMW for copying their grill. LOL

  8. Larry D. Says:

    7 I though Joe Foreman should sue. He makes grills, Kia makes Grilles.

  9. ChuckGrenci Says:

    The Escalade also gets the I6 3.0 liter turbo charged engine which could be a more economical choice in such a large vehicle. While perusing other sites (on the Escalade launch), I gleaned that the interior is properly luxurious and I sure like that integrated instrument information screen(s); there are three OLED curved screens. I also believe that even though the Escalade’s exterior styling isn’t revolutionary, it will age well as the previous design stylings have, and will make the offerings from Land Rover and Lincoln, dated quickly (of course styling is subjective so I won’t count on universal acceptance to my remark).

  10. Phred Says:

    About Ford’s poor market performance…the cars are good, the MachE is a winner…but the Captain of the ship is disconnected from the way forward.

  11. Larry D. Says:

    https://www.facebook.com/photo.php?fbid=10157823432120149&set=gm.1260177047509483&type=3&theater

  12. ArtG Says:

    7 It’s GEORGE Foreman. There’s some irony for you. Before you criticize others…

  13. Larry D. Says:

    12 Pfffftttt… (hint: utter contempt). I actually felt there was something wrong. I admit I don’t follow any stupid (or not) sports. So sue me. At least I know my grill from my grille. Do you, anklebiter?

  14. Larry D. Says:

    PS My ‘sport statistics’ were the monthly auto sales, until all the losers (detroit 3) stopped the monthly data, followed by even more automakers.

  15. Roger Blose Says:

    Buddy Hackett has got to go after all of the damage he has done at Ford. The list is long and Bill Ford had better get it together ASAP or it Ford will be merging with TATA. Come on, are you a car company or real estate development firm. I am looking to replace my Ford sedan with a competitors model since Ford no longer cares about us sedan owners. And I am not alone!

  16. Drew Says:

    First, Hackett needs to take personal responsibility. He is the person who launched a Smart Redesign process that distracted the entire workforce. He is the person who prioritized mobility funds over core business (and has eaten crow, er, wasted about $1B) by shutting down many of those follies). He is the person wasting management’s time and attention with overly trite Huddle communications and mandatory reading of ephemeral drab. As John noted, it seems Hackett is throwing his “team” under the bus. Give the bus keys back to a real leader of technology and transportation.

    Second… I’m sorry Sean, but those BMW wheels are still ugly.

  17. Kit Gerhart Says:

    2 In addition to what your link says, a number of people wouldn’t want the plant in Texas, at least near where they live, for the same reason a lot of people in Spring Hill, TN didn’t want the Saturn plant. It would increase traffic, increase cost of living, and not provide jobs for many of the people already there. For people near the plant site who would want to sell their home and leave, it would be good, but if they want to stay there, in a job they already have, it would not be so good.

  18. ArtG Says:

    Yesterday, they were also implicating warranty claims for the abysmal DSP6 DCT in the Focus and Fiesta in the poor earnings showing. They have nobody but themselves for that debacle; knowing it was junk but foisting it on the public anyway. They’ve lost a lot of customers forever with that one.

  19. Drew Says:

    Sean, I think 13 owes 12 an apology.

    15 I agree.

  20. Kit Gerhart Says:

    5 Yeah, that engine should be good in about any Mustang, except a Mustang II, as well as Crown Vic/Grand Marquis.

  21. Lambo2015 Says:

    12 Oooh! ArtG how dare you correct the almighty Larry. You little ankle biter. LOL but hey thats funny coming from the guy that likes to nibble a little further up the leg.
    Apparently superiority is knowing how to spell even when what your spelling you know nothing about. Ironic

  22. DenMor Says:

    I’m a Ford fans, but if Ford can’t make it in good times, they simply won’t survive the next recession. I initially said this 3 years ago and Ford has now had 5 horrible years. Musk has also been repeatedly saying in the last year, that Ford is done as a company as soon as the next recession. With their debt now downgraded to junk, worsening quality, collapsing sales and their stock heading to penny stock status, it doesn’t look good. Since abandoning the car business, Ford is now essentially a pick-up truck company. If they don’t turn this around in a hurry, the best they can hope for is to become the pick-up truck division of VW.

  23. Larry D. Says:

    19 You think WRONG, as usual. I only corrected a mistake. I was 100% polite in 13. My post was 100% proper. You are barking under the WRONG TREE. In my 38 year career I have actually actually PAID HANDSOMELY TO do what I do here FOR FREE, ie, to correct people’s Mistakes and EDUCATE THEM. Of course, I know not everybody wants to learn. Most would prefer to goof off and get drunk or do their opioids instead, and watch dumb shows on TV, not?

    Instead, EVERY pathological Tesla hater (and maybe others) here owes ME an apology for their hate-filled comments, usually filled with lies and inaccuracies. Get a LIFE.

  24. Lambo2015 Says:

    5 I find that engine offering surprising as I thought about two years ago Ford and GM were saying they had no new engines in development.

  25. Kit Gerhart Says:

    9 CR got ~35% better overall mpg with the diesel over the 5.3 V8 in crew cab, 4wd Silverados, 23 mpg diesel, 16 mpg gas. The 0-60 times were 7.9 diesel, and 6.9 gas. The outgoing Escalade with a 6.2 V8 did 0-60 in 6.1 seconds, and got 16 mpg overall. The Escalade weighed about 700 pounds more than the gas pickup, and 400 pounds more than the diesel pickup. I suppose it makes sense to offer the diesel in the Escalade, since some people just like diesels, but if the new Escalade weighs about the same as the old one, the diesel would be substantially slower than the gas one, and given fuel prices many places, the operating cost of the diesel wouldn’t be a lot lower. It will be interesting to know what the price premium, and the take rate of the diesel turn out to be,

  26. Kit Gerhart Says:

    23 I think the “new” engine is, basically, a revival of the old 460. I’ll see if I can find anything about it.

  27. Lambo2015 Says:

    24 People buying Escalades probably have little concern over fuel economy or operating cost. Their buying a vehicle close to the 6 digit mark if not over.

  28. Lambo2015 Says:

    22 You actually actually have paid handsomely to do what you do for free? Hope you didn’t pay much. Why you would pay to correct peoples mistakes seems like a losing proposition.

  29. Kit Gerhart Says:

    25 Correction: From what I’m finding, I think I was wrong in #25, and the Ford pushrod V8 is a new engine.

  30. Kit Gerhart Says:

    26 Yeah, true. I’ll be surprised if the diesel has a very high take rate in Escalades, even though, by all accounts, it is probably the best of the “light truck” diesels, and even if it is a no cost, or low cost option in the Escalade.

  31. Bishop Says:

    Kit, the 7.3L V8 is a new engine designed to be a highly durable replacement for the V10 that was so popular in fleets and fabricator chassis (RVs manuf etc). A lot of fleets prefer gassers over the costs (upfront and ongoing) of diesels. It has a very similar torque curve of a diesel and is not tuned to be a screamer (high rpm). But that doesn’t mean that people can’t change that if they want to stuff it in something else. Surely, there will be aftermarket developments designed to do just that.

  32. DenMor Says:

    Really Sean,

    You publish Larry D’s multiple diatribes and arguments with other posters but don’t include my comment # 22?

  33. Kit Gerhart Says:

    30 A friend had one of those V10s in a motor home, and had major problems with a stripped head, or something related, when changing spark plugs. Was that very common, or was he just unlucky?

    I’d almost expect Ford to sell that 7.3 as a “crate” engine for street rods, if it is physically small enough to fit in most applications where Chevy 350s are used.

  34. Lambo2015 Says:

    30 Yeah while at a recent RV show I asked why very few RVs get diesel until you jump up to a Class A diesel pushers? Their answer was simple in that most RVs get very few miles a year. Its easy to find a 10 year old motorhome with less than 30K miles. So due to cost they just don’t bother offering them in much.
    He agreed it made sense for hauling a large motorhome and towing a car or boat behind it because of the power over gas. But would be a hard sell for upcharge to go diesel.

  35. Drew Says:

    21 – Two thumbs up. The vast majority of comments here are thoughtful and respectful. I’ll go further to assume the average commenter here is highly educated in a combination sheep skin degrees, brow sweat, and work experience.

    We read and respond to the comments/issues because we value a diversity of perspectives. We cringe at the personal attacks/name calling (a behavior correlated to intolerance and shallowness).

  36. Kit Gerhart Says:

    32 Here’s an article I ran across a couple weeks ago about gas vs diesel for fleets of “medium duty” trucks, normally kept for about 8-10 years and not more than 125K miles. It makes a strong case for gas in those applications.

    https://www.government-fleet.com/156355/gas-vs-diesel-the-bad-investment-only-fleet-managers-know-about

    I suspect that new Ford big gas V8 might be popular with the fleet they are discussing.

  37. Sean McElroy Says:

    @DenMor – Whenever it’s the first time someone is commenting on our site it’s marked as pending, which means it doesn’t show up in the comments section until we approve it. We were not purposefully holding back your comment. We’ve approved it, so any time you’d like to comment in the future under the same name and email you’ll see it right away.

  38. Brett Cammack Says:

    8
    When you’ve got nothing to add, quibble over spelling.

    If your eyesight was as bad as mine you might miss the occasional typo yourself.

  39. Barry T Says:

    I’m pretty sure the Escalade‘s additional space is substantially because of their change to an independent rear suspension, allowing a lot better packaging for rear seat legroom and also cargo space.

    What I cannot explain is why it took them 18 years to follow Ford‘s lead on that, other than the fact they were selling enough without paying the cost of the engineering and changeover…

  40. Drew Says:

    @22 – DenMor, welcome to the site. Great comment. I agree (see 16).

  41. Kit Gerhart Says:

    39 Most people who buy this big SUVs would know whether they have IRS or not, except for maybe a little better packaging. The IRS should, potentially, give better ride and handling, but most reviews I see don’t show the competing “long” Expedition to have any better, if as good of ride and handling as the Suburban.

    The clear down side of IRS is the extra complexity, and the potential extra maintenance of rear alignment. Will pickup trucks soon go to IRS? Maybe so. They could probably have lower floors for the box. Of course, not having the now-standard “lift kit” on the pickups could enable a lower load floor.

  42. DenMor Says:

    Thanks Drew. I’m a big Autoline fan. I just didn’t comment on their site before.

  43. WineGeek Says:

    Poor Uncle Jim he is finding out that building cars is a little different from building filing cabinets.

    Kill all the cars don’t keep a single one. Why, because he read in the Wall Street Journal that passenger cars are a dying breed. Even though he is building new passenger cars in other parts of the world one or two of which probably could be built in North America utilizing the same design and chassis as these other vehicles. All this even though Toyota and Hyundai are releasing advanced design sedans with lots of high tech features that will bring in new sales because there are still a lot of sedans sold. If the market was 99% SUV then it would make sense to trow the sedans out but there is still a marketplace in passenger cars and why couldn’t Ford play in that place?

    Give it up Uncle Jim take a rest…

  44. Kit Gerhart Says:

    22 While I buy cars, not trucks, I figured dropping cars might be an ok business decision for Ford, at least for now. As you allude, there must be a lot more wrong, if they can’t do well in “good times” with all of those high profit trucks.

    If, instead of dropping all the sedans, they had sold a new Fusion hybrid, and made it competitive with the Camry and Accord hybrids, I would have considered it. Instead, they abandoned a still sizable market.

  45. Kit Gerhart Says:

    43 The European Mondeo would have been a good basis for a new Fusion for North America.

  46. Larry D. Says:

    45 There is no need for a new Fusion in the North Am. The Mondeo does ok in China and Europe and it should be enough.

    Too many mid-sized sedans in a shrinking segment is bad for EVERYBODY.

    Bad for the automakers, who lose $ or have much smaller profits

    BAD for the buyers, higher volume sedans can be offered for lower prices and/or with better quality and options.

    Almost ALL Automakers selling in the US should significantly prune their model range.

    Only GM at its PEAK when it had 50% and once close to 60% market share, can have the volume necessary to offer a full range of vehicles. Now it is still the no 1 US seller, but has barely 17% share! And Ford and FCA have much less!

    ALL automakers, if they want to be Healthy and Profitable and offer good deals at good prices, MUST prune the ridiculously long list of models they offer.

    Back 30 years ago, the total no of models in the US was less than 300! Now they are over 1,000, and sales have NOT quadrupled since then.

    It is common sense.

    Honda used to offer a long list of utter losers, and the buyers of Accords, Civics and CR-Vs were subsidizing them, or the workers and the shareholders, or all of the above. It was a HUGE waste of billions. They finally understood their error and trimmed their range by many models, nobody today even remembers their stupid alphanumeric names.

  47. Kit Gerhart Says:

    46 Why not sell the Mondeo in North America, as Fusion, Mondeo, or whatever name they choose? Even the old, 8 year old Fusion was selling in reasonable volume, and, presumably, a new one would do better.

    You’d have to go back about 45-50 years for there to be real choice in cars, when there were 2 and 4 door sedans, 2 and 4 door wagons, convertibles, hardtops, and for those who wanted them, a few SUVs, all from mainstream brands. Also, there were color choices beyond black, white, 5 shades of grey, and one or two real colors. Also, there were interior color choices in mainstream cars, not just expensive cars. Then, there were engine and transmission choices. If car companies could offer real choice in 1965, why not now?

  48. Lambo2015 Says:

    47 Kit I agree that it would nice to see a better selection and the automakers have taken stabs at it. However a 2 door wagon would be a hard sell today. Seating for 7 with only 2 doors? No one would buy it. The last car I think GM offered a wide variety was the Cadillac CTS. It could be had in 2 door 4 door and a wagon all with 2WD or AWD and 2 different V6s or V8 versions. But as we keep seeing the 2 door and the wagon had few takers. Those models were dropped early due to poor sales.
    I honestly think Ford and GM believe that sedans are evolving into the crossover. That the seated car position will be reserved for sportscars. The crossover and CUV will replace sedans and then you have SUV and trucks. This may be true but that’s only a US thing with our super low gas prices. Everywhere else in the world sedans are still popular and they should be prepared to import them as soon as our gas prices spike.

  49. Bob Wilson Says:

    “MUSK’S TESLA STOCK WORTH $30 BILLION” – and I got a taste too. Taking profits, I paid off the Model 3 cut insurance to liability. With eight cameras recording traffic and security along with Autopilot, the car protects itself.

  50. Larry D. Says:

    47 Because Honda and Toyota have much better offerings which not only sell many more units, but make much better profits AND are much more satisfying to own. VOlume means little if you are not profitable and if your model is as good as the competition, and the Fusion and esp the FUsion HYbrid that I did test drive, despite the fake Aston styling, was much inferior. It is ridiculous and unacceptable for that Hybrid to barely get 31 MPG in stop-go traffic, as shown by its own display and calcs, when the Prius 10 years ago would get 51, and the Accord and Camry that YOU bought get 45+!

  51. Larry D. Says:

    46 The points I made are really compelling and are not appreciated by myopic consumers who just think about their convenience and choices and do not think about the industry and its health as well.

    It is a basic principle of Free Trade too, that each nation should not idiotically make EVERYTHING they use, but, assuming there are 20 equal trading nations and twenty products, each nation should SPECIALIZE and make the ONE or two they make Best (does not have to be absolute advantage, even relative advantage works!) And TRADE for the othes! A WIN-WIn all around situation, WIn for EVERYBODY, much better products, higher volumes, lower prices, everybody is MUCH happied than if they STUPIDLY built each nation ALL 20 products, with lousy volumes, high prices, poor quality etc.

    As I said, it’s 100% Common Sense. You do not need a Phd In Economics to figure this out, you just need to think beyond your narrow self interest, which actually SUFFERS if you stupidly build 1,000s of unprofitable models instead of 100 GREAT, Profitable AND Affordable ones!

  52. Larry D. Says:

    Look at the Toyota Yaris and the Honda Fit and the other losers (ALL Are losers) in this unpopular subcompact segment: The Chevy Sonic and Spark (hope they were both killed), the late Ford Fiesta, the cheapest of the cheap (but roomy) bargain basement Nissan Vesta or whatever they called this Renault Megane clone. And then you have the god-awful Hyundais and Kias in this segment (I have had to rent them and I know how bad they are), and others. RIDICULOUS for a segment that sells a tiny fraction (one fourth? one fifth?) what compact or midsize sedans sell.

    Too many dogs fighting for too little meat, all are hungry and unsatisfied. VW wisely does NOT import the excellent (compared to the above) Polo, not even a cheap Skoda or Seat Variant. FCA also does not touch this stupid segment, AND it was rewarded today, with profits in Q4 instead of GM and FOrd’s losses.

  53. Kit Gerhart Says:

    48 I liked that CTS wagon and coupe, but would have been much more likely to buy if the had been Chevies at Chevy prices. Now, there is a lot more choice of two door cars from “premium” brands than mainstream, because, with their inflated prices, they can afford to sell them in lower volume.

  54. Kit Gerhart Says:

    50 Mightn’t the new Mondeo be better than the ~8 year old one the US Fusion was based on? I’d think it should be.

  55. Lambo2015 Says:

    53 I’m reminded why no one wants 2 doors anytime I take people in my car. The back seat is pretty useless and I didn’t care when I bought it as 98% of the time its just me or maybe one other person with me. But getting into the back seat requires some flexibility and that you not be too large. The coupe model has the roof line lowered from the sedan and anyone over 5’8″ will likely touch the ceiling if they sit up strait. I like the looks but its basically a 2 seater.
    I wish more cars were offered in a convertible. I remember when almost every Cadillac could be had in a drop top. Safety regulations has just about killed the convertible. Now its reserved for the sports cars and that’s about it.
    I suppose it would be hard to talk on the phone with the top down and considering most people I see on the road are on their phone the Conv probably wouldn’t sell either.

  56. Kit Gerhart Says:

    55 Mercedes, BMW, Audi, and Lexus have coupes and convertibles, some with with fairly roomy back seats, but all at relatively high prices. The closest to “mainstream” convertibles in the US market are probably Camaro and Mustang, except for the rather specialized Mini and Miata, and Jeeps.

  57. Ken Says:

    Would love to have Autoline add the feature where users can block posts from our view, to weed out some folks that post on this page.