Thursday, July 5, 2007

Ford tried to bit the time

Ford executives bemoan the fact that their turnaround is looking better internally, but that the company is outwardly fighting a perception gap that its vehicles aren't as good as those made by some Japanese companies.

Mark Fields, Ford president of theAmericas, said the company is making good headway at stabilizing its market share. Ford has lost market share in the U.S. for eleven consecutive years, he explains, but its new product line - which he described as "the strongest in the company's history" - is giving the struggling carmaker a shot at finally ending the slide. Ford is actually ahead of schedule in stabilizing its market share at about 14 to 15 percent, one goal of its Way Forward restructuring plan, Fields said. The company's newest products such as the Mercury Milan and Ford Fusion, have been boosted by an aggressive marketing campaign, and have increased their sales this year. The Ford Edge is now outselling the Toyota Highlander and the Lincoln brand has become one of the fastest-growing luxury brands in the market, Fields added. The new Ford Escape and Mercury Mariner also have been doing very well and have given Ford added traction in the rapidly expanding crossover segment, which had been dominated by Asian brands. In May, 52 percent of Ford's sales were cars or crossovers, and same trend is holding true during June. Fields said it's the first time since 1994 that Ford's cars are outselling its trucks and minivans. The 2008 model year lineup includes the revived Taurus and Sable sedans and the updated Taurus X crossover. Formerly the Five Hundred, Montego, and Freestyle, the changes to the products went beyond the badges, said Derrick Kuzak, Ford's product development. A total of 500 hundred different engineering changes were made to the vehicles for 2008. Exterior mirror housings, for example, were notched to help improve fuel economy and reduce wind noise in the cabin. The Ford Focus also being revamped for the fall. While the 2008 Focus is built on a carryover platform, it's quieter inside and has been outfitted with features such as an iPod jack and Ford's new Sync system, which uses Bluetooth technology to enable hands-free calling. The upgrades to the interior of the vehicle will give the look and feel of a new car, Ford promises. The automaker is preparing, in fact, to make the Focus the centerpiece of a major marketing push, officials said. Kuzak also said even though the 2008 Ford F-150 is in the final year of its life cycle, an admission Ford officials have generally avoided up until now, the company has approved several enhancements including a new cargo organizer system and a built-in tool box. A new King Ranch version of the F-Series is being brought back and the back-up assist that shows a picture of what's directly in back of the tailgate on the rearview mirror is also available as option. A Chip Foose version of the F-150 also is in the works, he said. "Customers are telling us they like the product," added Fields, who noted the company's market share is stabilizing even as it reduces its dependence on fleet sales. "What we're telling people is to put us on their shopping lists," added Fields, admitting the company has to change customer perceptions. Going forward, Ford expects to concentrate its resources on safety, fuel economy, reducing cabin noise, and features such as electrically assisted power steering where the company already is a leader. Fields also said Ford essentially has met its goal of cutting 14,000 salaried jobs. Ford was seeking to reduce white-collar employment by 10,000 this year, in addition to about 4000 who left last year. "We actually are done with that,'' Fields said. "We do have some folks that are staying with us a little bit longer, through the remainder of the year, in some critical positions.'' About 27,000 U.S. hourly workers have left Dearborn-based Ford under buyout or early retirement offers as part of its effort to pare down its workforce, and Fields reiterated that number on Friday. Fields, however, also admitted the company faces substantial challenges, including repaying the $23 billion it borrowed last winter.

"Time is not our friend," he said.

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