Ford lost money on the last Mondeo according to research carried on the just-auto.com website. The net return on Mondeo investment turned out to be negligible in nominal terms according to Discounted Cash Flow (DCF) analysis undertaken exclusively for just-auto.com.
The report at www.just-auto.com/features_detail.asp?art=305 says that heavy discounting of the model is to blame, with output exceeding the level that could profitably be sold. The Mondeo brought other benefits to Ford, but the model was not profitable when looked at in isolation.
In launching the new Mondeo onto the European market, Ford will be anxious to avoid repeating past mistakes. Not falling into the ‘margin trap’ will be critical.
just-auto.com managing editor, Dave Leggett, said: “The last Mondeo was a great car and the new one has had a pretty good reception. It’s almost shocking to think that Ford lost money on the Mondeo simply because the company pumped out too many. I would guess Ford’s planners will be very mindful of that now.”
To read the full article go to: www.just-auto.com/features_detail.asp?art=305
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