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Thursday, June 15, 2006

Comments

Dave

The way I see it is that Ford has 2 ways of being profitable, and they can happen separately or together. They can lower production costs so that they make a larger per-unit profit, or they can actually make better products.
Obviously, this move to Mexico is to get a larger per-unit profit. Now, if they only use that money wisely (read: Put more into R&D and make better products).
If they don't, the profit will be short term and they will continue to lose market share and ultimately lose big.
As for being American cars...I don't think there will be any American car companies if they don't utilize the benefits of low labor costs found in Mexico.
Business economics dictate that when something can be done cheaper elsewhere, it's better to have it done there. Otherwise you're just putting yourself at a competitive disadvantage, cause your competition will be making them cheaper there, too.

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