Curbside Outtake: 1989 Ford Tempo – ” The Tempo And Topaz Have Been Losing Money For More Than A Decade”

This post started out as just another Outtake about this bruised and battered Tempo in my neighborhood that’s still chugging along, on the good days. But then I stumbled upon a Fortune magazine article from 1993 that was linked as a source at the Tempo’s Wikipedia page, which I consulted to remind myself of its last year of production. It’s about Ford’s massive $6 billion dollar investment in its ill-fated CDW27 platform, the Ford Contour (Mondeo in Europe) and Mercury Contour, the second largest automotive program investment ever after GM’s disastrous  GM-10 program that swallowed up over $7 billion just a few years earlier. I recommend it.

The article is an eye opener, although I mostly sort of knew the general story. Ford spent over ten years(!) on a global program to replace the very tired Tempo and Topaz, which a Ford exec admitted had lost money the whole decade they had been in production at the time. And of course the real killer is that the CDW27 program would end up as an utter failure in the US market, so who knows how many billions more were lost on top of that initial $6 billion.

Ah, the good old days…when GM and Ford just couldn’t figure out how to compete against a new Accord or Camry that rolled off the lines like clockwork every 4-5 years.

It was the huge profits on Lincoln Town Cars and pickups and Expeditions that kept the lights on in Dearborn, while Ford absorbed massive losses on its smaller cars, which they couldn’t develop and build as cheaply as the Japanese, even when they were made in US plants. The irony is that Ford is essentially in the same situation now again, taking multi-billion dollar losses on its EV programs, because it can’t build them as cheaply as Tesla. Thanks to mammoth profit margins on its trucks (thank you pandemic), Ford (and GM) are at least showing decent overall profits, unlike in 1992, when lost money in its US car business. And Ford just can’t be bothered with cheap small cars anymore.

I bet the Tempo/Topaz program cost a very small fraction of the Contour/Mystique program, as Ford just didn’t have those kind of bucks available. This would have been in the 1981-1983 time frame, when they were just emerging from a near-brush with bankruptcy. And what serious money they could muster was going into the Taurus program, which was a money maker.

The Tempo was of course just a US-Escort, blown up a bit in every direction except up and sheathed in a new aerodynamic dress. And under its hood throbbed two-thirds of the old Falcon six, with a new pushrod cylinder head to help reduce emissions. Now that was a brilliant cost-saving solution, to utilize the Falcon six block transfer machining lines and tools, which were of course now very much available and well amortized.

Stephanie and I rented a Tempo for a highly memorable week of exploring New Mexico in the fall of 1984. It was a highly mediocre automobile, slow, sloppy-handling, noisy, feeble and just deeply un-fun to drive. But it got us to some spectacular and remote spots, including some few very rough and rocky roads. So I can’t hate on it too much.

Little did I know Ford was losing money on every one of them.


Related reading:

1993 Fortune article: Ford’s $6 Billion Baby

Curbside Classic: Ford Tempo – A Car I Love To Hate  P. Shoar

Curbside Classic: 1991 Chevrolet Lumina Euro – GM’s Deadly Sin # 18 – Where’s The Light?  PN