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MT 18 September 2016

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maltatoday, SUNDAY, 18 SEPTEMBER 2016 VIII Motoring Ford to move all small-car production to Mexico from US: CEO FORD Motor Co Chief Executive Officer Mark Fields said on Wednesday that all of the company's small-car production would be leaving U.S. plants and heading to lower-cost Mexico, drawing another rebuke from Republican presidential candidate Donald Trump. "We will have migrated all of our small- car production to Mexico and out of the United States," over the next two to three years, Fields told Wall Street analysts at an investor conference hosted by the automaker. Trump, campaigning in Flint, Michigan, on Wednesday, called Ford's decision "horrible." He has criticized Ford's Mexi- can investments for more than a year and vowed to pressure the automaker to reverse course if elected. "We shouldn't allow it to happen," Trump said. Fields has previously responded to Trump's criticism by saying that as a global company Ford must compete by making solid business decisions. Earlier this year, Ford said it would invest $1.6 billion in Mexico for small-car production to start in 2018. During contract talks in 2015, Ford confirmed that it would move Focus and C-Max production out of its Wayne, Michigan, plant in 2018. The United Auto Workers Union said at the time that Ford planned to build the next Focus in Mexico. A source briefed on the matter said the shift of production to Mexico was expected to take place next year before the start of the 2018 model year. In April, Ford reiterated that it was planning to build two new vehicles at the Wayne plant beginning in 2018. Analysts have said they expect Ford to build a new Bronco SUV and Ranger pickup there. Fields said that Ford planned to shift a majority of its small car production around the world to low-cost countries by 2019, which could affect Ford's Western Euro- pean car production. Fiat Chrysler Automobiles NV said in April that it would realign North American plants to emphasize truck and Jeep pro- duction over car output. The changes are expected to be completed by early 2018. Both automakers are making the moves because U.S. consumers have turned away from traditional sedans and hatch- backs to SUVs and pickup trucks. The United Auto Workers has said the number of auto assembly jobs would not decline because workers would be busy making SUVs and pickup trucks. However, UAW President Dennis Wil- liams has said there was a risk that if gasoline prices rose again above $4 per gallon as in mid-2008, consumers might once again favour smaller cars. Automakers shifting money away from flashy show stands IS the international auto show dying? That might be a stretch, but with Ford, Aston Martin, Volvo, Lamborghini and Rolls- Royce announcing they're skipping the Paris auto show in a month, a once must- attend event is no longer, well, a must. The question for the car world is, are we seeing a trend? It's tempting to say yes, and in some ways it's even understandable: Instead of spending millions trying to woo potential customers to hot, crowded exhibit halls, automakers are increasingly reaching out to buyers where they like to spend time -- on Instagram, blogs or the beach. "There used to be the feeling that you had to be at every motor show," Aston CEO Andy Palmer told Automotive News. "But there are sometimes better ways of doing it than just always spending money on show after show after show." Further evidence: Most of BMW Group's top executives are skipping Paris to attend a board meeting on electric-car strategy, while, in addition to whacking its Lam- borghini presence, the Volkswagen Group is further cutting show spending, killing its historically lavish Group Night event. To do a show like Paris right -- an expen- sive, exhausting slog -- automakers have to spend millions trying to outdo the com- petition. Automotive News says in 2011 Audi spent more than $11.2 million building its temporary pavilion (complete with indoor track!) at its hometown Frankfurt show (Paris alternates with Frankfurt as Europe's big show) – a building that gets torn down after each Frankfurt show. Clearly cost is a factor, but so is chang- ing customer behaviour. Automotive News points out massive exhibits rose in impor- tance in parallel with the car becoming more and more a symbol of individual free- dom and success. The bigger, the better. These days it looks like the automakers are thinking, hey, maybe bright lights, loud thumping music and thousands of sweaty customers trying to get a peek at the latest crossover aren't the best way to sell cars. Ford, for example, says instead of its Paris exhibit, it's trying a new approach to marketing in France, inviting potential customers to one-day cross country test drives. Ford is boosting investments in experiential marketing 50 percent this year and is also spending more time at technology-focused events such as Paris' LeWeb digital-innovation conference. This summer, Rolls held cocktail parties, test drives and fashion viewings on the beach in ritzy Porto Cervo bay in Sardinia, Italy. The British automaker tailored some events to bloggers and Instagramers who put photos, videos and opinions online. Mitsubishi Motors plans to have a stand at Paris but also developed a website so users can take virtual night-time test drives of the new Mirage G4 sedan on their smartphones. All that said, no doubt auto shows are still a huge customer draw. More than 815,000 people went to the 2016 Detroit auto show (North America's biggest), the highest since '03. Frankfurt says 2015 ticket sales rose compared to the prior show, and the 2014 Paris show attracted 1.25 million, making it the auto industry's biggest. Let's also not forget that the likes of Mercedes- Benz, Ferrari and Jaguar haven't bailed on Paris. Lamborghini doesn't think foot traffic necessarily translates into sales. "We are revising our strategy," concerning auto- show attendance, a Lamborghini spokes- man told Automotive News by email. "The world is continuously changing," and the supercar maker "intends to anticipate these changes." "Anticipate those changes," indeed. Adapt or die – it's more than a common business refrain. Customers these days don't go to the dealer to look at cars, they go online. By the time they walk into the showroom, they probably know more about the car than the sales guy. It might be too early to make a call on whether the 2016 Paris show is a trend or not, but like the rest of the world, it looks like automakers are starting to understand that something needs to change. Reading the tea leaves as best we can, we're prob- ably in an experimental phase as automak- ers pick and choose shows strategically to save money and to try to figure out what works and what doesn't right now. Chances are some shows will fade away in time, but some will stay and grow. Automakers will do less with media on the show floor and more offsite during press days, while at the same time getting more interactive and creative with how they engage potential customers. It's going to be fascinating to watch play out.

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