Another day, another turnaround plan. For those of you keeping score, Ford’s “Way Forward 2.0” is actually the third version in four years. In terms of strategy, the new, new plan holds few surprises; FoMoCo is simply super sizing their right-sizing program. On the credit side of the ledger… nothing much. New models still won’t hit the streets anytime soon. But the Street has hit Ford. On “Blue Friday,” Ford’s stock shed nearly 12% or $2b of its value. Investors and pundits alike are finally waking up to the fact that America’s number three automaker is in triage, with the crash cart standing by.
The latest round of surgery brings new meaning to the word “invasive.” The United Auto Workers (UAW) rank and file face the deepest cuts: all of union leader Bob King’s 75k plus brothers and sisters will be optioned. Ford hopes that between twenty-five and thirty thousand punch card people will accept one of eight offerings— involving various combinations of lump sum payouts, tuition breaks and health insurance. Employees have until November 27 to sign-up and sign out. All takers must be out the door by September.
The cuts reflect an increase in plant closings and “idlings,” from 14 to 16. The company has identified nine plants it’ll axe in 2008: Atlanta Assembly (Ford Taurus, 2028 workers), Batavia Transmission (1445 workers), Essex Engine Plant (695 workers), Maumee Stamping Plant (680 workers), Norfolk Assembly (F-150, 2433 workers), St. Louis Assembly (Explorer, Aviator, Mountaineer, 1445 workers), Twin Cities Assembly (Ranger, B-Series, 1866 workers), Windsor Casting (522 workers) and Wixom Assembly (Lincoln Town Car, 1259 workers). Sensitive to upcoming elections, Ford refuses to name the five other plants set for closure.
At the same time, fourteen thousand white collar Glass House inhabitants are due for defenestration. Ford figures all the cuts will save the company $5b annually. For now, the buyouts will burn through roughly $7b– in ‘07 alone. At the end of this, Ford reckons it will produce 3.6m units. That would slice FoMoCo’s share of the domestic auto industry pie to somewhere between 14 and 15 percent. Even at this new sub-Toyota size, even with lowered overheads, Ford will still have to score some major new product homeruns to meet their new goal: profitability by ‘09.
That’s going to be tough. The lost market share has gone to the competition. Despite announcing that 70% of Ford, Lincoln and Mercury “products by volume” will soon be new or upgraded, other than the cross boarder crossovers already on their way, Ford’s product pipeline looks decidedly dry. More Mustang variants, re-dubbed F-150’s, a V6 Lincoln flagship and a full-size people-carrying CUV are the only short term prospects. Two of these erstwhile saviors are niche vehicles and another contributes to the shrinking market that led to this debacle. The boxy (bold?) people mover will have its work cut out for it; Honda and DCX’s refreshed minivans are just around the corner.
Despite assurances that Ford will finish the year with $20b in the hopper, roughly half of those funds go to daily operating expenses. Just like GM, cash crunch time is coming. Blue Friday’s revelation that the formerly flush company is eliminating its stock dividend, saving $400m, indicates that liquidity has become a worry. Although Ford insists that none of the members of the Premium Automotive Group are up for sale, they are. Although the company claims it won’t sell a stake in Ford Motor Credit Co., it will. Bailed out parts supplier Visteon is also being cut loose. And FoMoCo will try to off-load 23 pieces of real estate it acquired last year.
It’s no wonder Billy's Boyz are still in surgery. Their previous doctoring was either too little, too late or too little too late. With the UAW’s inflexibility over at Chrysler and contract negotiations starting next year, it will be a long time before the patient will be stabilized– never mind cured. But the really scary part is that Billy Ford is still large and in charge, leading the Way Fordward. CEO Alan Mulally, who started collecting his gigantic paycheck last week, took a back seat during the press briefings. Mulally's contribution: "They are really trying to look through clear glasses and deal with our industry's reality." Oy they.
There is but one bright spark of hope in all this. Ford has decided not to kill the venerable, well-loved Lincoln Town Car. Could it be that someone in the increasingly-less-vast Ford Empire realized that if so many good products hadn’t been left to whither on the vine (Town Car, Focus, Taurus), if there had been some genuine fordward thinking, FoMoCo wouldn’t be desperately chasing lost market share in crowded segments? It may be a piercing glimpse into the obvious, but when you’re chasing anything, you’re always playing catch-up.
Man, all this time and focus on GM and their problems…while Ford may be the first to drop.
No profit ’till 2009? They’re in a lot of trouble.
More fire-fuel: A Detroit native, so-cal transplant, 2001 Focus owning friend of mine flew back to the motor city the other day for a wedding. She called me and asked me what a good, cheap car to rent would be. I said Honda Fit, she said Ford Focus. I warned her not to get the Focus.
“Why not?” she said. “I love my Focus.”
“You’re not going to like the interior” I told her.
“I won’t care about that.”
Before we continue, I should point out that her car has just over 100,000 miles on it and is falling apart. i.e. She needs a new car.
Last night I get the call, “Oh my God!? What did they do to my Focus?”
Long story short, she HATED the interior.
And this is how Honda will get another new customer, one born and raised in Detroit and until now very loyal to Ford.
“New models still won’t hit the streets anytime soon” ? ? ? ?
I could swear the Edge is due out in a month or so.
Ford Edge due Spring ’07.
Just waking up, drinking the morning coffee, and seeing no more evidence that Ford is on the right track.
It just hit me that I’d like to see Ford die – temporarily. See, I’m wracking my brain trying to think of ways that company control can be wrestled away from the Ford family and the current board, which is the only way the company can truly be saved. Seems to me that if Ford were to go under, then maybe the Fords and the Board would finally be forced to give up their iron-fisted control to an outside group of investors who could deal with the unions and the dealers and the remaining employees and rebuild the company the right way.
Oh sure, the Way Forward IV could eventually restore the company to mediocre profitability, but is there any guarantee that part of the plan actually includes great cars we actually want? No. Ford may just end up a slimmed down company with more “almosts” and “for less money than a Camry’s” instead that sell just enough to break a profit.
Personally, I don’t have any interest in a moderate sedan or CUV like Fusion or Edge. But I would like to see an innovative and edgy Explorer replacement, or a Lincoln that actually does battle with Lexus or Cadillac. Or a hot-rod RWD that does battle with the Chrysler/Dodge’s. Wouldn’t that be cool. Where’s that Ford 427 they were bragging about?
If Ford management really wants to step up to the plate now, they can outline their future design plans and let us know if new engines, upgraded materials and all-around better designs are part of the plan, or whether they plan to continue the “almost as good” mantra, with more Lincoln/Merc copycats wearing the ugliest taillights in the business (just look at the rears of the Zephyr/MKZ and Navigator).
It amazes me how quickly Ford came to this point. When I started doing business with Ford in 1995 I was very excited about their car line up: T-Bird SC, Taurus SHO, Contour SE, Mustang Cobra, etc, etc. They were well-built, attractive and had some of the best interiors in the business.
I think the beginning of the end started in 1999 with Nasser’s vision of a “holistic” auto company (hey, let’s spend billions on youth driving schools and scrapyards). They were fat and happy with billions in the bank, on a spending spree for new car companies and Explorers, Expeditions and F-Series were flying off the lots. In 2000, they killed Contour/Mystique/Cougar, effectively killed the Taurus and tried to make consumers think the Focus was the perfect car for everyone until you needed an SUV or minivan. In short, they abandoned the car market for the better part of 5 years!
The irony is that I live in a part of North America where Ford’s retail business has never been better!
I can think of several Fords I will consider for my next car purchase (Freestyle, Edge, Escape, Mark X maybe even an Explorer) but nothing “turns my crank” like some of those cars in the `90’s.
Maybe they can finally see their way clear to fast-track the Euro-Focus for production as well as the promised B-Car they’ve been talking about.
Bold Moves indeed.
It would be interesting to hear from some Ford “insiders” just why the corporate culture doesn’t seem to care about product development after a new model is launched. It’s what the Germans and Japanese have been doing so successfully.
The sad, sad history of Lincoln is especially heartbreaking (and not likely to turnaround soon: has anyone seen the “new” Navigator??) And yet in cities around the world, the wedding limo of choice is most likely to be a white Town Car stretch. I rented a TC last summer from Hertz, it was a black sedan with the longer back door/seat. I liked it more than I thought I would. For a body-on-frame it was rigid as hell. Drivetrain was smooth, reasonably powerful and I got 26-27 mpg hwy. The main negatives were the poor fake wood, no tach and unsupportive seats. Plus the ugly front and rear styling.
I have never understood why Ford hasn’t given rear i.r.s. to this platform. They saw the ride and packaging advantages irs gave to their large suvs. I would imagine the system from the last four-passenger T-Bird could be adapted. It might allow them to finally re-design the fuel tank that has caused so many police Crown Vic fires.
Add new front and rear clips and voila a new lease on life for the old trooper.
very sad to see Ford go down, but the mistakes are so numerous and obvious they truly deserve their fate. The October Automobile has a photo of a Dodge Charger police cruiser, jeeezus i hope to never see one of these in my rear view mirror! Another opportunity missed by Ford, they could so easily have upgraded the old Crown Vic and not lost this market. The Focus started out so well, the SVT Contour, sigh… I think their tombstone should read “they made a helluva truck”
At the end of the day, I don’t think the key problem with Ford has been family ownership. Recent management hasn’t been terribly good, but frankly it hasn’t been much worse than GM’s. Indeed, one advantage of family control is that it has the POTENTIAL to be less dependent upon Wall Street group think than a typical public corporation such as GM.
The larger problem seems to be what Brock Yates once called “Grosse Point Myopia,” an affliction where the Detroit elite fail to recognize how quickly the world is changing around them.
GM is doing somewhat better right now primarily because of its sheer size, but it has made largely the same product mistakes as Ford: Putting too many eggs in the big truck/SUV market instead of learning how to compete more effectively in passenger car segments — particularly at the lower end of the market.
I don’t think that Nasser’s vision of a “holistic” transportation company was such a bad idea in theory. That’s the future, folks. Alas, Nasser was careless in the implementation of his strategy. More importantly, even those mistakes would not have been fatal if Nasser hadn’t put Ford’s American passenger car line on a starvation diet.
That Nasser discontinued the likes of the Contour and Cougar might have been good moves IF he had reinvested those saved resources into emerging passenger car market niches. Instead, whatever profits that weren’t whisked off to the bean counters were plowed into expanded big truck and SUV lines.
It amazes me that a guy with so much international experience would make such a peculiarly American mistake — particularly with “environmentalist” Bill Ford looking over his shoulder. I guess that shows the power of Grosse Pointe culture. Remember, not too long ago Nasser’s moves beautifully fit Detroit’s conventional wisdom of what constituted savvy management.
Mr. Farago might have better info than I do, but a highschool buddy of mine who works at the Oakville plant where the Edge is being built said the first Edges will start rolling off the line in mid to late October, and into dealerships in mid-November.
I read October or November too for the Edge … Spring seems a little late for an 07 release.
A guy at the Carspace forums at Edmunds says he ordered his and it’s due on Oct 23. He might have his head somewhere it doesn’t belong, though. Plus there’s a reference there to Oakville employees saying Job 1 is scheduled for Oct 17.
http://townhall-talk.edmunds.com/WebX?14@@.efaf132/536
Anyway, I like the Edge a lot from what I’ve seen. Too bad I’m not looking for a new car for a couple years at least, but the folks are.
I am not surprised Mulally was in the background, after all, other than driving them his knowledge of the automotive business is nonexistent. I do wonder how he likes the back seats of Navigators and Town Cars, because in his position he ain’t driving anymore. Ford’s goal in the near term is obviously to reduce production as fast as possible while still managing to generate some cash to develop a compact and mid-size automobiles that they can actually make money on. Rumors have abounded for several years now that Toyota has figured out how to make money on platforms that sell well under 100,000 units, while GM and Ford are still locked into the position that no money is made until a product run pushes into the 300,000 plus level, and real profitablility comes somewhere in the 1 million unit range. This is the real long range problem of Ford and GM, they don’t merely need the 1 million seller in the car range to be competitive, they need the 50,000 unit seller that makes money. And just to be really annoying their product cycle is STILL 2 years longer than it should be. I hope they have the cash to survive, but if they can’t produce a Civic/Golf (Rabbit) killer in the next couple of years and make money on it I don’t know how they will survive longterm.
I have an idea that would be fun. Consider the current car and truck market: many different models from all the manufactures. All about the same. Price, performance, value, economy. Just blah everywhere I look.
Here’s what I propose:
We have the “base models” as they are right now. The ones everyone knows and some love. I suggest making 2 additional versions of all of these models. Make one of them get extreme mileage. What ever it currently gets + 10 at a minimum.
The other version of all these vehicles, make it a performance model. Aim for at least 14 seconds in the 1/4 mile as a base line. Every single car and truck made. I think this could and would create some really hot competition between the automanufacturers. All I’m asking for is motor swaps with these existing cars and trucks. What we currently have, plus more. No more of this average middle of the road stuff. ~100-200hp, 20 something mpg, and 16+ seconds 1/4 mile performance is just plain boring.
The ’07 Crown Vic: 200hp range and 17/25 mpg. That’s fine for some people(maybe). Make an “E” version potentially either a V6 or hybrid. Gets 30 or 40+ mpg. Don’t put the IRS in the Mustang; put it in this car! Make a performance model that is 300+ hp. Hybrid, base, performance.
’07 Mustang: Regarding that IRS. Offer both. The handling version and the “normal” version with the solid 8.8″ axle in it. The Mustang motor lineup looks decent. It could still be improved though. Higher mileage from the V6, more power from the base, more power from the bigger motor. Lower prices on all vehicles and lower weight! Shave off 1,000+lbs from this thing for a full second off the 1/4 mile performance!
’07 Escape, I see three different models and none of them are good enough. What’s the point of a 4, 6, and a hybrid when they all get about the same mileage and performance!!!??? I want hybrid getting 40mpg+, the base model(V6?), and a 300+hp model for some action. With 300+hp, someone could truthfully say “I drive an Escape and it’s respectable”. You want magazine reviews to gush over your new vehicles? Give them everything. A high mpg hybrid for the envrionmental types, and absolute high performance for people that need, want, and desire that. What could they complain about? Want mpg? Want performance? We’ve got it all!
’07 Explorer: Why offer a V6 and a V8 when they both offer nearly the same hp/tq, and mpg? Hybrid it for 30+ mpg(do extreme aero mods to this model: belly pan, nothing on the roof, lower it, narrow it, chop it. Look at the Prius, Insight, and EV1 for clues), pick a motor to keep for the base, and give me 350+hp for performance. Put the 5.4 in it or one of your supercharged motors. You want to sell some Explorers? 2 more versions: A lowered RWD version that handles absolutely amazing! The city version. Now make an off road version. Maybe a little lift and the biggest tires you can stick under it. What can you fit? 31’s or 33’s?
’07 F150: 3 motors? All about the same hp/tq and mpg? Why? Hybrid, pick a motor to keep for the base, and give me something more exciting then the current 5.4. How about a diesel F150? For some real towing. Factory option 5th wheel or goose neck trailer attachment? A dually F150? Lifted and lowered models? Can I take the sides off that bed so I can have a flat bed if I need it?
’07 Focus: Hybrid, base, performance. You know the deal. How about a little 50mpg diesel? If vdub can do it, why can’t you?
’07 Fusion: This poor car has no soul. No identity. It will sell well once it gets established in peoples psyches that it is a good, reliable car. Right now, it’s new and people are scared of it and don’t trust it yet. Hybrid, base, performance. Make this car an absolute rocket!
This is how you beat Honda and Toyota. You make versions of your vehicles that beat them one way or another. You want better mileage? Use this car. Want to beat them with performance? Use this one. Beat them all around? Beat them with your base model that ideally(would be a tall order but doable), get them on price, performance, and mpg. You have to beat them in every way. Find out what is wrong with your vehicles and make drastic changes. Simplify your stuff. I don’t need 15 computers in the car and 200 miles of wire. Get reliability from simplicity. Make it impossible for anything to go wrong or fail. Zero errors. My 2001 Ford Ranger has these dumb sensors in the door latches and sometimes when I shut the door, a light illuminates in the instrument cluster saying the door is ajar. Those sensors and that “feature” should have never been installed!
Radical, drastic, extreme, immediate changes are needed and on order here. Overnight chaos. Turn the auto industry inside out and do it starting on Monday. Take existing motors and start installing them in other vehicles and hop up other motors to get what you need out of them. You’ve got the vehicles, just put the right mix of motors in them!
Remember that motor that was in the Ford GT?! Put it in the Mustang! Put it in a truck! Put CAT diesels in your 250’s and 350’s! Offer all of them! The crazy and insane models that make unreal tq. And advertise the diesel tq not the hp. 300hp, big deal. 800 ft/tq though!!
’07 Ranger: Your current motor lineup is pointless. A gutless 4 banger that doesn’t even get good mileage and two different V6’s that get nearly the same hp/tq and mpg!! Why? Hybrid, decent base motor or even a 50 mpg diesel, and a V8 model that is an absolute rocket! How about lifted and lowered versions? You put an 8 in the Explorer, why not the Ranger!? A V8 Ranger is wanted and needed!
Do you remember the 1993 – 1998 Toyota Supra? That car can be modded easily for 1,000+hp! The 1984 – 1987 Buick Grand Nationals and T-Types? These were both phenomenal 6 cylinder cars!
Why offer only a handful of different paint colors for each model? I see dealerships full of white, black, red, and silver cars. Make every color that exists available on special order. Make it possible to get any new car or truck in any color. Not just the ones that exist now..
Engine swaps are the easiest way to improve your product lineup and make the offerings exciting and compelling.
Also, consider offering two suspension packages for every car and truck(spring swaps). Cruising/luxury and performance. I can’t stand a stiff ride. Seems like every car and truck made I can feel every single crack in the road. Maybe some people like that and want that. They can have that in the base model(that you already make) or in the performance model. Swap out the springs and give everyone the option to have the best ride ever. Consider putting airbag suspension on everything. Look at the landing gear on a Mooney aircraft for example. Take existing airbags and seal them with a certain amount of air. Might ride better then coil springs? Lighter weight, cheaper, smaller package?
Have your employees drive Accords, Civics, and Camry’s. See what all the fuss is about. See if anything is different and why those cars are supposedly so good. Experience them first hand. Read all the reviews of all the cars and trucks made. If there is anything that is good about another car, take notice. Anything bad about yours, take immediate action and do a mid year change on it. Make whatever is wrong with anything be no more. Be vigilant and proactive. Fix all problems immediately.
Ford is axing 14,000 office staff, one third of the total. I wonder what kind of jobs those people are doing right now. It seems to me, when you reduce staff so much, you need to cut a lot of products and vehicle platforms. Which platforms are going to disappear and can they still reach 15% market share with the platforms that remain? What do you think?
Dear Ford,
Why oh why can’t you please just manufacture and sell all your class-leading European products in NA and just move on?
Oversimplification – sure – but you did it before… Mk1 Focus is a great example of this concept, so why not apply to other vehicles, such as Fiesta, Focus Mk2, C-Max, Mondeo, S-Max, Galaxy…? These cars kick Toyota/Honda/Nissan/DCX ass in styling, performance (esp. diesel engines), materials, and overall desirability.
Is it really impossible to sell these designs in NA and not make profit? Isn’t there _some_ way to do it? If you can’t, then how do all your import competitors sell their vehicles in NA and make a profit?
I think it’s wicked to taunt your home market with your ability to design, produce and sell great cars elsewhere and then deny us of them. Why do we get your worst effort ALL THE TIME? Infuriating!
EJ,
My guess is no, GM and Ford do NOT have what it takes to “win back” customers. Look at their sales decline over the past 30 years. They may have had a few bright spots along the way, but the trend downward is clear…and will continue into the foreseeable future.
Again, they may have had a few bright spots along the way (Taurus, etc), but GM and Ford have always been comfortable with their own self-serving gratitude to where they really do NOT know how to “compete” ( in true sense of the word). Sure, this gentleman’s rivalry between GM and Ford pickups is fun and all, but it’s just that…a load of crap not taken too seriously.
How can I say this? Because up until recently the average full-size pickup had a refresh cycle of an aircraft carrier- once every 12 years or so.
One other thought: If GM and Ford “wished” to compete…then they would!! It’s that simple!
All interesting.
Have two fords an 89 5.0 mustang and 95 Windstar (201,000 miles perhaps a record). Thinking of replacing the Windstar with a non SUV where you sit high. Not a lot out there. Came up with Freestyle and Volvo XC90. Have looked carefully at both and have came to the conclusion that for 30% more cost the Volvo is twice the car. Since it is my understanding that the Freestyle is built on the XC90 platform I am at a loss as to how Ford MO CO could possibly have so degraded the entire vehicle. Did the beancounters look at every component and shave X amount off the price for that part? How could Ford manage to degrade the Engine, Transmission, suspension, interior materials, performance and milage to the degree they did and not bring the Freestyle to market at MSRP under $20,000. I am coming from a Windstar so my expectations are not high:).
Looking at the current Freestyle gives me little hope that Ford will be able to turn things around. In the $28-35,000 crossover (read station wagon) range (where they have positioned this vehicle) it is probably the weakest contender.
to htn: you might consider a RAV4 7-pass, Pilot, or the upcoming Mazda CX-9. Why Ford gave 7-pass to the CX-9 and not the Edge is beyond me…
I have a fragile 2001 Focus, which is a lot of fun when it’s not busy shedding parts. I’d love to replace it with the Focus ST 5-door sold in Europe but obviously cannot. See http://www.youtube.com/watch?v=1lLRFn6Pntk for a fun reference.
The Focus sold today is essentially the same car as mine (with lower quality IP plastics). 5 years running and no replacement in sight! I am forced to consider a Civic Si, VW GTI or MazdaSpeed3. Too bad…
Imagine a fishing vilage where people work very hard to catch enough food to live on. The people in the village not only work hard, they must constantly keep their fishing methods updated to reflect changing weather and fish conditions.
Then a huge whale washes up on the beach. They are elated, they salt the meat and blubber and spend the next 10 years living off the whale. they get fat and lazy.
The analogy: The village is Ford. The ‘whale’ is the “big iron”: full size trucks and SUV’s. At one time the Ford expedition factory was the most profitable in the world. Also – vehicles like the expedition did not require much new technology.
For ignores a niche market called “cars” (small, medium, large).
Xabtua10000, that’s a great video. The 300hp version would sell great if they could keep the price down. Why stop at 300 though…
Here’s another great pro-Ford video from back in the day when they had it all together:
http://www.youtube.com/watch?v=wKJXf_CkCds
That’s what they need now. Exciting, compelling products. My parents owned a 64.5, 65, 67, and 70 during those years. My Dad has a different 65 vert sitting in the garage now and drives an ’88 5.0 vert to work. I’ve got an 87(5.0).
For those of you who have seen a lot of Top Gear episodes; you’ll really be able to appreciate this one:
http://www.youtube.com/watch?v=3uphjLppVGM
Watch this one after that one:
http://www.youtube.com/watch?v=PhC2Og_vd_4&NR
Fast cars are good…(and fun!!)
xantia10000…
http://www.ford-v8-focus.com/
I just saw a brand new Ford Fiesta sedan driving down the 10 freeway in Los Angeles today. Is that a sign that they are to jump back into the rediscovered sub-compact market sooner than originally thought???
For those who complains that new cars design won’t come until 2009, I suggest he/she read the book “the mythical man month”. In a nut shell, you cannot build/design something faster just by adding people late in the game. Ford and GM are late, very late to the game of cars after they abandoned it, and that’s the cost of reentry.
IMO, I would rather they bite the bullet and cut production, and focus on redesigning the next gen product, rather than spending those money on cash back and incentives. Getting Euro and Aussy models to the US is not that easy, you have to deal with changes in manufacturing line and supply, let alone emission and safety related code. That’s the thing, if a company as bing as the big 2.5 can allocate just 1% more resource to make sure each plant can build all the cars/trucks in that size, and every model can be build anywhere, they would have shrunk the turn around 1 year ahead of schedule.
Learn from the computer industry: graphic cards/processors have a 6 month product cycles of refresh and 1 year cycle of re-architect, HD company like western digital always have 2 cutting edge architecture overlapped just in case one has a fatal problem/recall/disaster, and a new product is planned/designed at least 2 years before the market needs it.
What have the big 2.5 done? New product by 2009 means….. they haven’t started designing it until Sept, 2005, or haven’t even started yet.
Blue collar workers offered buyouts, and white collar workers will get the ax. Ford truly is on the way to being an mostly outsourced company: core profitable models such as trucks and the ‘Stang designed/built in the US, and major platform engineering for most other vehicles done by Volvo, Mazda, and Ford of Europe, with production skewed towards Canada and Mexico.
At least they might get rid of enough people with the CYA mentality that put Ford where it is now, while devastating the morale of those who are left. To paraphrase what happened to Boeing after the financial problems following the 747 in the early Seventies, “Will the last one leaving Deaborn please turn out the lights?”
A comment to Nathaniel: Unfortunately, I think the Fiesta you saw was most likely from Mexico. I live south of LA (where many stores accept payment in pesos!) and see Mexican Fiestas and Ikons on the roads and freeways all the time (even saw a Ka once).
I wish they could quickly bring these to the US market– they look good and Ford could sure sell ’em here, but I guess they weren’t designed with US emissions and safety standards in mind. I think the next few years until they can get a Fiesta type vehicle to the US market are going to be long ones for Ford.
2 things:
1) Nathaniel – the Ford Fiesta you saw in LA is probably like the one I saw here in San Diego – it had Mexican plates on it. I think they sell them south of the border, but not up here. I’ve seen Ford Ka’s on the road here too, with Mexican plates.
2) About the CYA mentaility – from my experience in management that is rarely a fault of the people who end up with that mentality, and more often a fault of the corporate culture created by senior management. I have worked in management at both US, European, and Japanese companies and have seen it at 4 in 6 of them (at least one from each region). All 4 of those were stagnant, but that culture was not the fault of middle management, but rather thrust upon them. The standard joke is “we know what we have to do, and we know what we are going to do.”
The question is: How many workers in the Ford Company are important to pay back the 150 billion USD debt ? A rest of 10.000 workers will not be able to pay back the mountain of debt. So, the rating agencys will cut the debt rating again, I think.
Wall Street says the massive cuts that Ford announced this week is not enough and their strategy will not be good enough to turn things around quick enough. How did they determine this because the stock price lowered about 12% ($1.07) on the news of their new CEO and restructuring plan “Way Forward II.�
Nothing amazes me more than the arrogance of so-called industry watchers who think they know more what to do than the people at Ford. They want changes now and fast, which equates to more and more job loss because it is an easy fix and requires only a stone-heart to carry it off (Bill Ford cared to much). Here are some examples:
The plan “may slow the decline of this venerable icon of America’s industrial golden age, but it is simply not enough.”
Peter Morici, professor at the Robert H. Smith School of Business at the University of Maryland and former chief economist at the U.S. International Trade Commission
“It does not materially accelerate product introductions. It does not provide a solution for the troubled facilities assumed from Visteon. It does not cut capacity deeper. It’s missing a lot.”
John Murphy of Merrill Lynch, who downgraded Ford stock from neutral to sell
“We … believe that these are not the right steps necessary to address Ford’s overcapacity problem in North America. We are confident that we will see Ford’s Way Forward Plan, Part 3, in the not-so-distant future.”
— Joseph Amaturo and Kelly A. Dougherty of Calyon Securities Inc.
Reread these comments, do you see any solutions offered? Do you see any mention of CUSTOMERS? Nope, it’s just BS from people who have no idea what they are talking about, anybody can sit back and throw darts at a dying elephant and not miss. What data do you have to support your comments?
The type of problems Ford has are complex, they took years to develop. Many are the result of poor mismanagement that no longer works at Ford Motor Company. I posted about these types of complex problems last year. – http://qualityg.blogspot.com/2005/12/quality-complex-process-problems.html
Bill Ford cared to (sic) much. Here are some examples:
And then…
they (the problems) took years to develop.
If Bill Ford cared TOO much, then he would NOT HAVE ALLOWED THIS MESS TO DEVELOP!! Year, after year…after yet a few MORE years.
You contradict yourself, quality. I’m inclined to believe Bill Ford cared too LITTLE! Too little about his company, too little about his products, and yes, too little about the jobs which depend upon a healthy company and a healthy product portfolio.
When those 16 plants turn out the lights for good and lock the gate behind, can Bill Ford HONESTLY look the crowd of 45,000 people in the face as say “Well, I’m sorry…I just cared a bit TOO much!”.
To say Bill Ford cared too much is utter baloney.
PS, your quality write-up / Systems Engineering material you wrote about is Pretty GOOD!! I like the fact you took your own time to write such a nice article (sincerely).
But you need to state your Assumptions up front.
No 1: Do NOT WAIT 7 or MORE YEARS TO REACT…THE MARKET IS RUTHLESS AND WILL BEAT YOU TO A LIVING PULP!!!
No. 2: TAKE ACTION. NOW!!! NOT WHEN IT’S TOO LATE!!! IF YOU REACT (INSTEAD OF BEHAVING IN A *PROACTIVE* MANNER) AND IT’S TOO LATE, YOU WILL *NEVER* RECOVER!!! WHY? BECAUSE THERE ARE 6 BILLION PEOPLE IN CHINA WHO ARE STARVING AND WANT TO STEAL YOUR LUNCH!!!
Rastus,
The problems were ther long before Bill Ford took over as CEO.
As for caring, I guess me knowing a person does not equal your “assumptions.”
From Dearborn….
I do not work for Ford.
What’s with all this “caring” crap!!!?? Sure it’s nice to work for a caring company, but at this point of the game it’s too late. Caring is not going to pay the debts or make up for consistent bad decision making.
Toyota eating their lunch kicking ass and taking names.
The UAW is the 800 lb gorilla that is still waiting to be fed.
And it’s mighty hungry.