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Rising aluminum costs cut into Ford's profit

When Ford reports fourth-quarter results on Wednesday afternoon, it is expected to fret that rising metals costs have cut into profits, even as rivals say they have the problem under control. Aluminum prices have risen 20 percent in the last year and nearly 11 percent since Dec. 11. Steel prices have risen just over 9 percent in the last year. Ford uses more aluminum in its vehicles than its rivals. Aluminum is lighter but far more expensive than steel, closing at $2,229 per tonne on Tuesday. U.S. steel futures closed at $677 per ton (0.91 metric tonnes). Republican U.S. President Donald Trump's administration is weighing whether to impose tariffs on imported steel and aluminum, which could push prices even higher. Ford gave a disappointing earnings estimate for 2017 and 2018 last week, saying the higher costs for steel, aluminum and other metals, as well as currency volatility, could cost the company $1.6 billion in 2018. Ford shares took a dive after the announcement. Ford Chief Financial Officer Bob Shanks told analysts at a conference in Detroit last week that while the company benefited from low commodity prices in 2016, rising steel prices were now the main cause of higher costs, followed by aluminum. Shanks said the automaker at times relies on foreign currencies as a "natural hedge" for some commodities but those are now going in the opposite direction, so they are not working. A Ford spokesman added that the automaker also uses a mix of contracts, hedges and indexed buying. Industry analysts point to the spike in aluminum versus steel prices as a plausible reason for Ford's problems, especially since it uses far more of the expensive metal than other major automakers. "When you look at Ford in the context of the other automakers, aluminum drives a lot of their volume and I think that is the cause" of their rising costs, said Jeff Schuster, senior vice president of forecasting at auto consultancy LMC Automotive. Other major automakers say rising commodity costs are not much of a problem. At last week's Detroit auto show, Fiat Chrysler Automobiles NV's Chief Executive Officer Sergio Marchionne reiterated its earnings guidance for 2018 and held forth on a number of topics, but did not mention metals prices. General Motors Co gave a well-received profit outlook last week and did not mention the subject. "We view changes in raw material costs as something that is manageable," a GM spokesman said in an email.

Ford's J Mays feels vindicated by Fusion reception

It's hard to think back now, but the same man overseeing the design of the 2013 Ford Fusion also presided over a rather lackluster period in Ford design, highlighted by vehicles like the Five Hundred and Freestyle. With the redesigned Fusion receiving high praise, J Mays tells Automotive News that he feels vindicated from criticisms suggesting he's not a daring enough designer.
When Mays took over as lead of design in 1997, he admits to having quite an ego ("My head would barely fit through the door some days. I've long since gotten over myself") and the workload to match. With the Blue Oval's portfolio full of premium brands like Aston Martin, Jaguar, Land Rover and Volvo at that point, along with the bread-and-butter Ford, Lincoln and Mercury models, Mays certainly had quite the challenge.
It was in the mid-2000s that Mays took over just the premium brands, and took on the new title of Chief Creative Officer. At the time, Mays endured some criticism for looking backwards to retro styling, rather than setting a new standard for American car design - criticism that Mays says he is free from with the all-new Fusion.

2018 Range Rover Sport Coupe spied in Scotland

Sport utility vehicles are the rage. SUVs with coupe styling are pretty popular, too, as BMW and Mercedes have demonstrated. Now it's Land Rover's turn. Believed to be the upcoming Range Rover Sport Coupe, this ute was spied this week during top secret testing at a remote location in Scotland. The vehicle would slot between the Range Rover Sport and Evoque, giving Land Rover an answer to the Mercedes GLE and BMW X6. These shots show what appears to be a chopped roofline, giving the new model a sportier profile than the traditional upright silhouette of Rovers. We expect it will use a version of the aluminum Jaguar F-Pace platform and offer V6 and V8 engines. It could also offer a hybrid or full electric version. The new crossover might also be lower set in a bid to differentiate it from traditional Rovers and give it a performance vibe. The Range Rover Sport Coupe – or whatever it is ultimately called – would enter a strong segment that's found favor in the United States. Once derided for potentially offering less function than traditional utes, these lifestyle vehicles have developed a strong following for their style and capability. The X6 was so successful, BMW added the smaller X4, and this forced Mercedes to follow suit with the GLE and GLC coupe variants. In this context, it's about time for Land Rover to join the fray. Related Video: Featured Gallery 2018 Land Rover Range Rover Sport Coupe View 12 Photos Image Credit: KGP Photography Design/Style Spy Photos BMW Land Rover Mercedes-Benz