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Ford preps an orderly Falcon run-out

No discounts: Ford says Falcon remains competitive in its final year.

Expect value-added limited-editions - not price cuts - as Ford's Falcon hits run-out

Ford logo20 Mar 2007

EXPECT a series of value-added limited-edition Falcon variants – rather than a BF MkIII facelift - to be launched this year, as part of what Ford anticipates will be a sales battleground in the lead-up to its all-new Falcon in early 2008.

"That (large-car) segment will continue to be a challenge for us against all-new competitors," said Ford Australia president Tom Gorman on Friday.

"We think even in its final year Falcon’s share (of the large-car segment) should be better than 25.7 (per cent), and we’re taking tactical action to work on that.

"But this is going to be a battleground for us this year. Under 26 per cent isn’t where we really want to be. But we still have an outstanding car.

"There’s no question from a driving dynamic, frankly, BFII is as good as any of the new products on the road today.

"We know that our next-generation Falcon is going to leap substantially where they (Holden with its VE Commodore) are, so we’re not worried about that at all." Mr Gorman said that apart from special-edition offers, Falcon’s six-speed automatic transmission, LPG option and performance would be heavily promoted in an effort to keep sales bubbling this year.

"We’ve had good dialogue with our dealers over the past few months and they’re very familiar with our program timing, so they know the battle they’re in for.

"The issue is that the sheetmetal is now new, and that still attracts people into the showrooms. We’re working very hard at point of sale to ensure the dealers emphasis where we have benefits - and there are many technical benefits for us.

"We’ll emphasis six-speed continually. That is a big advantage. The ZF six-speed auto is an outstanding ‘box and when you marry it to a great engine you get great performance and fuel economy and we need to get that message out more aggressively.

"LPG is something we have that the others don’t and we need to press aggressively there.

"As well there’s the performance end. You’d have to say Holden has done a good job with the VE in the sports segment of the large sedan marketplace. They have been successful there and we’re aware of that. We need to be competitive in that area too."

Don’t wait for Falcon, Mondeo bargains

FORD says customers shouldn’t wait for unrivalled run-out deals on the BFII Falcon as it enters its final 12 months on sale.

"We could go chase (sales) volume in the near term and go slash and burn price and do all that and then what happens when the all-new Falcon comes out?" said Ford Oz boss last week.

"There has to be a cohesive story so that you’re not in a position where the consumer has such sticker shock, and you have so destroyed the brand value that when the new one comes out people say it isn’t worth what you want me to pay for it.

"You walk a very narrow plank here. I’ve done this before so I know what it feels like. When you’re in the process of exiting one product and getting an all-new one in the future, you have to run the business properly and avoid the temptation of just dumping volume today, because you’re kidding yourself when you try to launch the new one.

"We want to go through an orderly transition from the BFII to the new Falcon and it takes some bravery to do that because as you know the pressure is always on to chase the volume," he said.

Similarly, Mr Gorman says Ford is prepared to risk slower sales of both Falcon and the upcoming new-generation Mondeo by pricing the European designed and sourced mid-sizer right into the heartland of Falcon’s price range.

"We’re trying to be true to our brand DNA, which fundamentally is we make driving cars and every segment we compete in, from Fiesta to Focus to the new Mondeo later this year, to Falcon and Territory... our strategy is building great driving cars and that’s a critical part of our overall marketing strategy.

"Our primary source of engineering as you know is Ford Europe. We see them as a great engineering source and we believe that within the Ford world we know how to do it well here in Oz and they know how to do it well in Europe.

"So when you combine the domestic portfolio with the imported portfolio you get a brand DNA that makes sense." Mr Gorman again referred disparagingly to Holden’s mid-size model strategy, which recently saw the Opel-designed Vectra effectively replaced by GM Daewoo-built Epica, to be launched next month from a bargain-basement $25,990.

"We’re not about just bringing in Korean product, rebadging it and selling it at the low end. That’s not what we’re doing. We’re really trying to build our brand and if that means we have to be premium priced then so be it.

"We recognise that in the short term that may mean we have to walk away from some volume – and clearly in those segments we’re not the volume leader – but we do believe it gives us the position where we can stand by the product in terms of what it delivers."

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