By Peter M. DeLorenzo
Detroit. Last week, key executives from the Ford Motor Company took members of the press under the tent in an “On the Record/Off the Record” presentation that basically laid bare the company’s product plans over the next 24 months. Though it wasn’t an unprecedented move – many auto companies have taken this route in the past – it was a signal that the company’s momentum has been brought into question, and that the gathering storm clouds off in the distance are getting closer.
There’s no question that the perception that Ford is in trouble triggered this rare press event. And the timing of this presentation was calculated to break through the cloak of negativity that seems to be lingering over the company, especially from certain denizens of Wall Street who view anything connected to Detroit and the automobile industry with skepticism, if not outright hostility. (Especially now that Elon Musk has become the Patron Saint of all that is righteous and good when it comes to the automobile for many Wall Street types, and that anything that isn’t Tesla must therefore be antiquated and bad.)
CEO Jim Hackett opened the proceedings by talking about the future of Ford and the advanced technologies that Ford is fully engaged in that will drive transportation into The Future. This has been “Professor” Hackett’s standard stump speech for a while now, just as it has been the standard fare for every other automaker of late too. But given that this was a product-focused meeting, Hackett’s remarks seemed a little stale, especially since they have been out there for a good long while now. After all, this was clearly an “all hands on deck” effort from Ford to convince the gathered press that the company’s products would be vibrant and competitive, so meanderings on where The Future was going had people looking at their watches.
This is the essence of the problem for Ford, and a source of much of the negativity hanging over the brand. Hackett has spent too much time talking about the long view for Ford – the connected cities, the coming fundamental changes to our lives, etc., etc. – and not enough time conveying the transformation going on at Ford right now. This event was designed to change that.
From there, the presentation was handed over to Joe Hinrichs, President of Global Operations, who laid out just how successful Ford has been with the F-150 pickup. And make no mistake, the F-150 is “The Franchise” of the Ford Motor Company. How much so? If the company stopped selling everything but the F-150 today, it would still generate more than $40 billion in revenue, a staggering statistic. But the point of the meeting was exactly that – that as successful as the F-150 is Ford needs more vehicles for the heart of the market, which means SUVs, and lots of them. In fact, 86 percent of Ford’s vehicle lineup by 2020 will be trucks and SUVs, up from 70 percent today.
To achieve this transformation – there wasn’t a peep about cars, except for a reveal of a King Kong Mustang that’s coming – Ford is working on a wave of SUVs, ranging from a total (and long overdue) revamp of its other hot performer, the Explorer, to a brace of new, edgier SUVs, including a sharp alternative execution of the Escape, and a very interesting BEV crossover that seemed dangerously close to being vaporware. (That I am suggesting that this particular product is vaporware speaks to the High-Octane Truth about Ford, and the fact that they are absolutely nowhere when it comes to BEVs. Not that BEVs are the be-all and end-all for this business, but the fact that Ford is clearly lacking in this area looms large.)
But by far the most interesting product (briefly, hinted at but not fully revealed) discussed last Thursday morning was the all-new Bronco. The Bronco is one of the iconic nameplates of this business, and the fact that Ford is bringing it back is crucial. And just based on a few glimpses, I expect it to be a full-fledged hit in the market.
As I’ve said many times previously in this column, it’s shocking that FCA has been allowed to sell the Jeep Wrangler without any serious competition from Ford and GM. Due to the bankruptcy GM gave up Hummer, which was an egregious mistake, especially since the Hummer had made notable inroads in the market at the expense of Jeep, and the Hummer H4 concept, which was on GM Product Development computer screens when the bankruptcy hammer slammed down, was going to be a real threat, taking dead aim at Wrangler.
And now, here comes the Bronco. The fact that Ford waited this long to even consider bringing back the Bronco is borderline criminal, but now that they are bringing it back, the fact that it is still two years away is a real shame. In fact, that all of the vehicles discussed last week are at least two years away (except for the Mustang, which is scheduled for 2019) is a real problem for Ford. As people immersed in this industry know, 24 to 36 months is an eternity in this business. And though Ford displayed some very competitive-looking products to the media last week, this business doesn’t exist in a stagnant holding pattern. The players in this business are constantly percolating ideas and churning out new products, in fact the pace of competition is growing fiercer by the month. I have the utmost respect for and confidence in Hau Thai-Tang, Ford’s executive VP of product development and purchasing. He is one of the most talented True Believers in this business, and if anyone can deliver on Ford’s product, Hau and his team can deliver, and then some.
So, this is the long – and short – view of Ford.
On the one hand, Professor Hackett’s long view is indeed compelling, at least up to a point, but it’s only as compelling as every other automaker’s pronouncements on The Future and their role in it. Everyone’s putting their spin on the same idea: connected cars, ride sharing, AVs, and on and on and on. It’s allegedly going to be a beautiful world filled with shiny happy people skipping to a new beat and rolling in anonymously uninvolving vehicles, hassle free. The fact that whatever transpires is years and years away and will be confined largely to a few urban centers across the country is beside the point. All of the auto manufacturers are cut from the same cloth, they refuse to be dictated to by Silicon Valley and they will be part of the Driving Future, one way or the other.
That’s all well and good, but on the other hand the short view is that Ford has its back against the wall. The enduring success of the F-150 will go down as one of the lasting achievements in automotive history, but the ugly reality is that it isn’t enough, and Ford executives are now painfully aware of that fact. Ford desperately needs new products in-market, as in yesterday. Taking the automotive media under the tent was as much about generating positive buzz with Wall Street-types as it was to give the press something positive to write about when it comes to Ford.
But two years is a lifetime in this business, and the clock is ticking.
And that’s the High-Octane Truth for this week.