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Project Ugly Horse: Part VIII

Now With More EcoBoost
There's an EcoBoost 2.0-liter turbocharged four-cylinder in there somewhere, and it's headed straight for Ugly Horse.
For the second time in my life, I'm staring at an engine in the back of a truck with no concept of how to get it safely into the garage by my lonesome. The first time this happened, I dragged home a $300 International 345 V8 in the back of my Scout Terra only to discover that the bounds of my manliness terminated well before my ability to muscle that 800-pound cast iron block out of the pickup bed.

Buy Ford and GM stock and make 5%

Want to make a five-percent return when 10-year treasuries are paying around two percent? Ford (F) and General Motors (GM) have solid balance sheets, strong cash flow, solid earnings, and growing markets. By all accounts, they are smart investments. But the market is down on these stocks. Why? Some of the stupid excuses include: They are cyclical companies The Detroit 3 have lost 3.5 million in sales since 2000 The world economy is shaky GM recently filed for bankruptcy Their markets have peaked They haven't changed their ways Let's take these criticisms one by one: They Are Cyclical Companies Yes, they are cyclical. Every company is cyclical. Every industry is cyclical. Some more than others, but not every company is immune from swings in the market. Banks used to be 'non-cyclical' leader, not anymore. Airline stocks are just as cyclical as auto stocks, yet they are trading at multiples greater than the auto industry. Why? And what accounts for the irrational stock price for Tesla (TSLA)? At least Ford (F) and General Motors (GM) make money and have positive cash flows. In fact, both companies have a net positive cash position. They have more cash on hand than liabilities. Auto sales in the United States hit a record 17.5 million vehicles in 2015. During the Great Recession, Ford (F) and General Motors (GM) cut their break even points to 10 million vehicles per year. Anything above an annual U.S. volume of 10 million vehicles is profit. And what a profit they make. Sales of Ford's F-150 continues to be the best-selling vehicle in the United States for over 30 years. Detroit 3 Have Lost 3.5 million in Sales Since 2000 Automotive News reports General Motors (GM), Ford (F) and Chrysler (FCA) have lost a combined 3.5 million vehicles sales since 2000. So how can they be making more money? Two big reasons – Fleet Sales and the UAW. Fleet Sales The Detroit 3 used to own car rental companies to keep their factories running. Ford owned Hertz (HTZ), General Motors owned all of National Car Rental and 29 percent of Avis, and Chrysler, the forerunner to Fiat Chrysler (FCA), used to own Thrifty Car Rental and Dollar Rent-A-Car. The Detroit 3 owned these rental companies to have a place to sell their bad product and keep their factories running. These were low margin sales, and in many cases, were money losers for the Detroit 3. They no longer own auto rental companies.

Next Lincoln Navigator to drop V8 in favor of V6, but Ford Expedition might get both

A great many buyers fled from full-size body-on-frame SUVs to car-based crossovers in large measure to save fuel. But that doesn't mean there's still not a buying audience for more traditional truck-based utility vehicles, and those consumers doubtlessly wouldn't mind saving some dollars at the pump, too. According to Motor Trend, those shoppers might be in luck.
That's because the magazine has confirmed that Ford isn't walking away from the full-size SUV segment, and it's poised to do something about its offerings' economy ratings, too. According to MT, global Lincoln director Matt VanDyke has hinted that the next Navigator may drop two cylinders and go with a V6 model - the current model gets just 14 miles per gallon in the city and 20 on the highway from its 5.4-liter V8. The obvious fitment would be Ford's 3.5-liter twin-turbo EcoBoost V6, an engine that has spread like kudzu throughout the rest of the Blue Oval's large vehicle lineup.
Downsized turbocharged engines like Ford's EcoBoost franchise have come under fire as of late for not delivering their EPA fuel economy ratings, but their benefits extend beyond consumption - the 3.5L offers superior power and a better torque curve than the naturally aspirated V8. MT also suggests that Ford's 3.7-liter V6 could form the base engine for the next Navi - it has similar horsepower but a lot less torque than the current 5.4L. That may be less of a problem with the next generation tipped to go on a diet, which could level the playing field somewhat.