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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.

Fiat Panda by M-Sport a one-of-a-kind rally car

English racing and engineering firm M-Sport is probably best known for the Bentley Continental GT3 endurance racer and the Ford Fiesta R5 customer rally car. Since building the first of 294 Fiesta R5 Mk. I cars in 2013, the fleet of pint-sized competitors has won a total of more than 950 races. So when a longstanding M-Sport customer asked the company to do something special with a clapped-out, 1990s-era Fiat Panda that would retain the car's Panda-ness but also make it a stonking rally car, M-Sport decided to combine the Italian with the Anglo-American. The result is the Panda by M-Sport, a widened Panda bodyshell lowered atop a Fiesta R5 chassis and engine. Otherwise known as Panda'monium. Or Pandiesta, if you're tipsy. Just fitting the skinny Fiat over the tube-frame chassis meant widening the Panda's body shell by 14.2 inches; that slick grille is actually made of two Panda grilles to gain the required width. That surgery helps maintain the original Panda's silhouette, but more was needed to slide the Fiesta's wider track underneath. More latitudinal stretch was provided by the box-section wheel arches that, up front, flow into a front bumper that is half snowplow. In the longitudinal direction, the Pandiesta's wheelbase is 12.6 inches longer than that of the stock Panda. The Ford's 1.6-liter EcoBoost four-cylinder lives under the hood. It sends nearly 300 horsepower and 332 pound-feet of torque to four Pirelli P Zeros through a five-speed sequential transmission and two custom differentials. The new rear diffuser and single, central exhaust convey the seriousness of the endeavor. Hand-embossed lettering spells "PANDA 4x4" on the rear hatch in case anyone has questions about this having as much capability as the standard Panda 4x4. The interior is all Fiesta R5 save for the Panda-mimicking instrument panel and the co-driver's footrest. The latter is also inscribed with the word "PANDA." Despite the license plate, there's no question of street legality here, or rather illegality. M-Sport says the Panda'monium is ready to do any special stage on tarmac or gravel. Seems this is also the car that launches a new division for customer creations called MS-SV, which is M-Sport Special Vehicles. You can watch M-Sport owner Malcom Wilson take you on tour of the Panda by M-Sport in the video at top, and check out what the finished product can do on a track here.  Related Video: This content is hosted by a third party.

Ford Recalling 70k Escape and Mariner Hybrids for cooling issue

Ford is recalling about 70,209 examples of the 2005-2008 Ford Escape Hybrid and the 2006-2008 Mercury Mariner Hybrid because the cooling pumps for their hybrid systems could fail.
According to the company's defect notice, it's possible for the original "Motor Electronics Coolant (MEC) Pump" to wear out and fail, which would could cause the hybrid system to overheat. If this happens, the vehicle goes into a safety mode that takes away most or all of its power. However, braking and steering still operate normally. After cooling down, the affected models restart normally. The company says that it's not aware of any accidents or injuries related to this problem.
Ford will begin repairing the vehicles in late October, and dealers will be installing improved, brushless pumps on the affected models at no charge to owners. If drivers had their pumps fail before this recall, they can contact Ford for a possible reimbursement. Scroll down to read the recall announcement from the National Highway Traffic Safety Administration or download the full defect notice as a PDF, here.