Aussie Focus "irresponsible": Burela

The decision to build Focus locally wasn't a "screw-up" says Ford Australia boss Martin Burela, but there's definitely no longer a business case to support it. Indeed the local blue oval boss said it would have been "irresponsible" to pursue the project.

Ford's about-turn on the plan to build the Focus small car here and rely long term on imported versions has left the company with a potential shortfall in production output of around 30,000 units a year. That's a volume unlikely to be filled by Falcon and Territory, although Burela believes that new variants of those models (liquid-injection LPG Falcon, EcoBoost Falcon and diesel Territory) can make up part of that figure.

Originally intended to keep the plant at Broadmeadows working at or near full capacity, the antipodean Focus has now been killed off -- declared infeasible by the incumbent president. This decision puts him at odds with the tactical decision by his predecessor-but-one, Tom Gorman.

"It would have been irresponsible of us to move forward with a Focus program in Australia," Burela told the press earlier today, "given the fact that our responsibility to the Australian market and to our customers is to provide a vehicle that is competitive in every sense...

"I came to the conclusion with the team that there was just no way we could deliver that value proposition at the levels of competitiveness that were required by producing the car in Australia," he continued.

"We were competing against an onslaught of imports that are coming into the country from various locations around the world -- and I don't think you have to be a scholar to see that the onslaught of further imports coming from emerging countries will be greater."

At the time of the original announcement, even Ford's competitors -- like Toyota, for instance; a company with actual experience building a small car in Australia -- questioned how Ford could make a locally-manufactured Focus work.

It's easy to understand the attraction for building such a car when fuel prices had shot through the roof at the time and buyers were deserting large cars in droves, but the Focus decision looks, with the benefit of hindsight, to be an example of tactical expediency more than strategic forethought.

Did the plan overlook Ford's acknowledged expertise in large cars (and the medium SUV Territory) in order to chase market share in segments where the company hadn't operated successfully, as even a CKD assembler, since the early 1990s.

There's a school of thought that the company's concentration on more fuel-efficient variants of the current large-car and SUV ranges makes more sense. The Carsales Network asked Burela how the decision to build the Focus here came to pass in the first instance and who had the final approval? We literally asked: 'Who screwed up?'

"I don't think it was a screw-up," Burela replied, "because if you go back and look at the decision when it was announced in 2007… I think, hand on heart, people honestly felt that there was a business case that could be made to localise the car."

Asked to amplify how the business case could have stood close scrutiny when it was clear that the small-car segment was only going to get tougher in terms of competitors, Burela was matter of fact.

"The world has changed, from an automotive perspective, forever. People are underestimating the level of change that has occurred because of the Global Financial Crisis. Volumes globally have significantly reduced in terms of companies' forward planning numbers.

"If we look at the ability to take a vehicle like that out of an Australian cost base and then export it into Asian markets, it would have been financially prohibitive," he stated.

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