Great Article About Mulally's Plans for Ford

[FordBuyer]

Ford’s radical transformation signals a dramatic shift for the company – and the American automobile industry.

 

By Peter M. De Lorenzo

 

Detroit. Now that the story is starting to get out about Ford’s dramatic future product plans due to be announced tomorrow, I can safely say that Ford, under the leadership of CEO Alan Mulally, will be the best-positioned American automaker for this still-new century.

 

That’s a strong statement, but an accurate one. No automobile manufacturer has undergone a more fundamental internal transformation than Ford. And by fundamental I mean everything, beginning with a philosophical shift in the way the company approaches this business led by Mulally, whose laser-like focus has altered the company to such an extent that it’s barely recognizable in less than two years.

 

Mulally has purged the paralyzing bureaucratic fiefdoms that thrived for years at Ford, he has eliminated the classic Detroit policy of designing, engineering and producing vehicles in a vacuum – something that has absolutely crippled the domestic automakers for years – and he has trained his entire team’s focus on the one thing that can in fact save the company, which is, of course, The Product.

 

I know what you’re thinking, that all of this stuff is so obvious that it really shouldn’t even be noteworthy at this point, but believe me, what will come out in tomorrow’s announcement from Ford can’t even begin to tell the story of what has gone on behind the scenes. The announcement will only address the obvious future direction of Ford’s product transformation; but the rest of the story is still being written, because it’s an ongoing process that gets refined, pushed and tweaked every single week by Mulally and his team.

 

The short story behind the announcement is this: Alan Mulally has completely abandoned what worked for the previous 30 years (and what has been made painfully obsolete over the last three months in this new “real price” energy world we live in) and has taken Ford in a new direction that basically eliminates the distinction between what Ford is in Europe and around the world, and what Ford is in the United States market, in terms of the cars offered.

 

In the old days of Detroit, Ford (and GM) made cars for different markets around the world, and what worked in Europe was never even considered for the U.S. except in a few individual instances, because the driving was different “over there” and the price of fuel was dramatically higher, which thus forced the need for a completely separate range of products than what we were used to.

 

In Ford’s case, American driving enthusiasts whined for years about the terrific Fords available in Europe that were never available here, and when Ford did venture to bring one of their stellar European products over here, they would never stick with them long enough to make a difference in the larger scheme of things because the company was designed to make money on producing large cars and even larger trucks.

 

All of that has now changed in one tumultuous quarter.

 

Mulally could have made a series of incremental steps, which is part and parcel of the Rick Wagoner school of “managing the downward spiral,” but he knew if he hesitated or made only gradual moves then Ford wouldn’t be around long enough for it to matter. So instead Mulally emboldened his team with marching orders that did away with the word “transition” and instead focused their raison d’etre on the word transformation, and the results will be truly breathtaking to see, to the point that Ford’s product lineup will bear little resemblance to today’s lineup in just 24 months.

 

The only way I can best describe just how radical Ford’s future product push is in terms that even the casual observer of the auto biz can understand is that what Mulally and his team have done is actually skipped a model cycle with these new cars headed for the U.S. market, so instead of doing a series of baby-step changes over the next three years, Ford will bring its 2012-2014 products forward to the 2010-2011 time frame in a blaze of models and configurations that will set the U.S. market - and its competitors - on its ear.

 

We’re talking a full range of smaller, more efficient sedans, sport coupes, crossovers, people movers and even urban delivery vehicles that will change people’s perceptions of what the Ford Motor Company is almost overnight.

 

Will Ford still make trucks and some larger vehicles? Absolutely. There will be a core group of American pickup buyers needing the vehicles for work applications, so that business will remain steady for the foreseeable future. It will be a much smaller market than what it once was, but it will still be viable for years to come nonetheless.

 

But the everyday “face” of Ford on America’s streets and byways will be radically transformed by these dramatically designed and executed new passenger cars, and it will be a refreshing sight to behold.

 

It’s actually fitting that an ex-Boeing engineer has led Ford’s fundamental transformation, given the fact that Henry Ford’s exploits into the aviation business were so noteworthy.

 

And it’s fitting, too, that the one American automobile company that basically pioneered this industry and that is celebrating the 100th anniversary of its vaunted Model T this year will be the company that will lead the domestic automobile business into the future.

 

Things are about to come full circle for the American auto industry, and for the legacy – and the future - of the Ford Motor Company, the timing couldn’t be better.

[FordBuyer]

A truly inspiring article from Autoextremist. Makes one want to buy more Ford stock tomorrow when market opens. I love this article.

[FordBuyer]

Sorry to be redundant and waste space. I didn't see the same thread below. Mea culpa.

[Ford-150]

i hope it is as extreme as Autoextremist is saying.

[SalCange]

Well being a ford employee for a little over six years, i have been able to see the quality and design in products improve first hand at a very rapid pace. I work at the KCAP. Since big Al has stepped up to the plate to lead this massive company, moral has also improved. Management and engineering has taken more of a do or die tone in everyday work ethics. With the lack of design from the past 5 years, (Taurus, focus, and the whole lincoln name plate) the product design given to us from europe will undoubtably do wonders for this auto maker and put us over the edge. I remeber reading an article about a month ago stating that ford was on track to become the next toyota. I'll be honest.. I was looking for the punch line as if it were a joke. But now it seems the writer of the article could very well be right. Surely it will not happen in the short comings but it just may come sooner or later. I am very prowed to be a ford employee and part of the wonderful UAW!

 

My hat is off to big Al!

[Ford Jellymoulds]

Sorry to be redundant and waste space. I didn't see the same thread below. Mea culpa.

 

Don't be sorry its great reading again.

[TheEagle]

Ford’s radical transformation signals a dramatic shift for the company – and the American automobile industry.

 

By Peter M. De Lorenzo

 

Detroit. Now that the story is starting to get out about Ford’s dramatic future product plans due to be announced tomorrow, I can safely say that Ford, under the leadership of CEO Alan Mulally, will be the best-positioned American automaker for this still-new century.

 

That’s a strong statement, but an accurate one. No automobile manufacturer has undergone a more fundamental internal transformation than Ford. And by fundamental I mean everything, beginning with a philosophical shift in the way the company approaches this business led by Mulally, whose laser-like focus has altered the company to such an extent that it’s barely recognizable in less than two years.

 

Mulally has purged the paralyzing bureaucratic fiefdoms that thrived for years at Ford, he has eliminated the classic Detroit policy of designing, engineering and producing vehicles in a vacuum – something that has absolutely crippled the domestic automakers for years – and he has trained his entire team’s focus on the one thing that can in fact save the company, which is, of course, The Product.

 

I know what you’re thinking, that all of this stuff is so obvious that it really shouldn’t even be noteworthy at this point, but believe me, what will come out in tomorrow’s announcement from Ford can’t even begin to tell the story of what has gone on behind the scenes. The announcement will only address the obvious future direction of Ford’s product transformation; but the rest of the story is still being written, because it’s an ongoing process that gets refined, pushed and tweaked every single week by Mulally and his team.

 

The short story behind the announcement is this: Alan Mulally has completely abandoned what worked for the previous 30 years (and what has been made painfully obsolete over the last three months in this new “real price” energy world we live in) and has taken Ford in a new direction that basically eliminates the distinction between what Ford is in Europe and around the world, and what Ford is in the United States market, in terms of the cars offered.

 

In the old days of Detroit, Ford (and GM) made cars for different markets around the world, and what worked in Europe was never even considered for the U.S. except in a few individual instances, because the driving was different “over there” and the price of fuel was dramatically higher, which thus forced the need for a completely separate range of products than what we were used to.

 

In Ford’s case, American driving enthusiasts whined for years about the terrific Fords available in Europe that were never available here, and when Ford did venture to bring one of their stellar European products over here, they would never stick with them long enough to make a difference in the larger scheme of things because the company was designed to make money on producing large cars and even larger trucks.

 

All of that has now changed in one tumultuous quarter.

 

Mulally could have made a series of incremental steps, which is part and parcel of the Rick Wagoner school of “managing the downward spiral,” but he knew if he hesitated or made only gradual moves then Ford wouldn’t be around long enough for it to matter. So instead Mulally emboldened his team with marching orders that did away with the word “transition” and instead focused their raison d’etre on the word transformation, and the results will be truly breathtaking to see, to the point that Ford’s product lineup will bear little resemblance to today’s lineup in just 24 months.

 

The only way I can best describe just how radical Ford’s future product push is in terms that even the casual observer of the auto biz can understand is that what Mulally and his team have done is actually skipped a model cycle with these new cars headed for the U.S. market, so instead of doing a series of baby-step changes over the next three years, Ford will bring its 2012-2014 products forward to the 2010-2011 time frame in a blaze of models and configurations that will set the U.S. market - and its competitors - on its ear.

 

We’re talking a full range of smaller, more efficient sedans, sport coupes, crossovers, people movers and even urban delivery vehicles that will change people’s perceptions of what the Ford Motor Company is almost overnight.

 

Will Ford still make trucks and some larger vehicles? Absolutely. There will be a core group of American pickup buyers needing the vehicles for work applications, so that business will remain steady for the foreseeable future. It will be a much smaller market than what it once was, but it will still be viable for years to come nonetheless.

 

But the everyday “face” of Ford on America’s streets and byways will be radically transformed by these dramatically designed and executed new passenger cars, and it will be a refreshing sight to behold.

 

It’s actually fitting that an ex-Boeing engineer has led Ford’s fundamental transformation, given the fact that Henry Ford’s exploits into the aviation business were so noteworthy.

 

And it’s fitting, too, that the one American automobile company that basically pioneered this industry and that is celebrating the 100th anniversary of its vaunted Model T this year will be the company that will lead the domestic automobile business into the future.

 

Things are about to come full circle for the American auto industry, and for the legacy – and the future - of the Ford Motor Company, the timing couldn’t be better.

 

Did you get that promotion that you just swallowed a load for? What does that mean for jobs? because if Ford does well who cares if people are not employed?

[mettech]

Well.... The market today didn't care for the "...Ford’s radical transformation".....

 

Ford stock dropped $0.92/share.

 

 

Six more statements from Mulally like today would put Ford at $0.00.

 

 

 

I sure as hell hope Ford makes it. But time is running out.

 

If this next batch of vehicles don't sell.......

[mlhm5]

Ford is very lucky they have Mulally. Really, what other choice do they have? Adapt or perish.

 

Mulally is having to cover for 30 years of mistakes and missteps by former Ford CEOs and he is doing a great job.

 

If there is a turnaround in the US economy in 2010, IMO Ford will be much better positioned to go to the capital markets.

[EMDEE]

This is all very encouraging but I think some of it is overstated, particularly the notion that product integration planned for the 2013-2014 period has been radically moved forward to 2010-2012. If my memory serves me, they've always been talking about getting the European products over here in 2010 to 2012. Similarly, the release of the 2010 Fusion and Milan and related hybrids had long been claimed for early 2009. No change there. The Lincoln MKT was always going to be "a year after the Flex" and the new Taurus was due in 2nd to 3rd quarter 2009. EcoBoost has been scheduled for spring of 2009 for as long as I can remember. Unibody Explorer was shown and more or less announced several months ago. First use of EcoBoost in 4 cylinder engines was going to be 2010 and still is. First European small car, the Ford Fiesta, was scheduled for 2010 and still is. As for the coming of a total of 6 Euro designs, I suppose that news but since they haven't identified them all, it's just a number for now. Perhaps the only thing that's really news here is the announcement about how they're going to shift some manufacturing plants from trucks to cars.

 

So what I hear is a really a collective presentation of the whole package at a single time, designed to shore up confidence among the investment community and to counter the news focus on Ford's big loss for the quarter. Nothing wrong with any of this. I just don't see it as "news." They're doing all the right things and have been since AM took charge and Bill Ford went back to playing golf.

Edited July 25, 2008 by EMDEE

[01FOCI]

Stock price has to do with this:

 

 

7.24.2008

Ford's Worst Quarter Ever

Problems at its credit arm and a writedown of assets, plus a poor economy and high gas prices, led to a second-quarter loss of $8.7 billion

 

 

http://www.businessweek.com/lifestyle/cont...ampaign_id=yhoo

 

"Ford Motor (F) reported a second-quarter loss of $8.7 billion, its worst single quarter in history.

 

Much of the loss was due to a writedown in the value of assets, and losses on falling values of SUVs coming off leases back to the automaker's Ford Motor Credit arm. But, like a kid who wrecks the family car and tries to distract his parents from the bad news by offering to paint the house, Ford unveiled a plan to make over its lineup with more small, fuel-efficient vehicles in the next two-and-a-half years—faster than Wall Street had expected. "

[F150 Man]

Ford’s radical transformation signals a dramatic shift for the company – and the American automobile industry.

 

By Peter M. De Lorenzo

 

Detroit. Now that the story is starting to get out about Ford’s dramatic future product plans due to be announced tomorrow, I can safely say that Ford, under the leadership of CEO Alan Mulally, will be the best-positioned American automaker for this still-new century.

 

Mulally has purged the paralyzing bureaucratic fiefdoms that thrived for years at Ford, he has eliminated the classic Detroit policy of designing, engineering and producing vehicles in a vacuum – something that has absolutely crippled the domestic automakers for years – and he has trained his entire team’s focus on the one thing that can in fact save the company, which is, of course, The Product.

 

I

 

Hey, Pete

 

I checked the company address book today and couldn't help notice your not listed as an employee.

 

Query: How would you "know" if Alan has purged the paralyzing fiefdoms? While he may discourage that behavior, I still see evidence here in Dearborn. I just watched some very capable managers get their walking papers because they were on the "wrong team". Their less capable superiors took the downsizing opportunity to dispose of the competition. Machiavelli is still alive an well here at Ford.

 

Our salvation here at Ford depends upon more than simply importing several Euro products... offering more product will not save the mothership. Everyone seems to assume that we will make more money selling more product. Not always, it depends upon were the breakeven points are for the various products being sold. You have to recover both investment and variable costs, before you make profit. Also, I doubt these products can can be simply shipped over an sold as is, there are may conflicting rules and regulations that govern the two markets.

 

While it may be One Ford, it is not One Marketplace. Let's hold our thoughts in obeyance and check back in 24 months and see were we stand here in Dearborn.

 

Also, I have a house to sell here in southeast Michigan..... It may be as simple as flushing the backlog of unsold houses!

[DUCKRACER]

Stock price has to do with this:

 

 

7.24.2008

Ford's Worst Quarter Ever

Problems at its credit arm and a writedown of assets, plus a poor economy and high gas prices, led to a second-quarter loss of $8.7 billion

 

 

http://www.businessweek.com/lifestyle/cont...ampaign_id=yhoo

 

"Ford Motor (F) reported a second-quarter loss of $8.7 billion, its worst single quarter in history.

 

Much of the loss was due to a writedown in the value of assets, and losses on falling values of SUVs coming off leases back to the automaker's Ford Motor Credit arm. But, like a kid who wrecks the family car and tries to distract his parents from the bad news by offering to paint the house, Ford unveiled a plan to make over its lineup with more small, fuel-efficient vehicles in the next two-and-a-half years—faster than Wall Street had expected. "

Does anyone here remember PINTO prices skyrocketing when the ARAB OIL EMBARGO happened it the mid-seventies?

Does anyone here know what a PINTO is?

Edited July 28, 2008 by DUCKRACER

[CPManx]

Does anyone here remember PINTO prices skyrocketing when the ARAB OIL EMBARGO happened it the mid-seventies?

Does anyone here know what a PINTO is?

Well, I recall the long-in-the-tooth Pinto outselling the full-size Ford in the late '70s, during the 2nd gas crisis. I remember compacts and subcompacts (even mediocre ones--Pintos, 1st-gen Escorts, 4-cyl Fairmonts) selling well while the big LTDs languished on the lots. And for years buyers have been paying premiums to buy the superior design and interior build of the Japanese small cars.

 

Selling well-engineered small cars and trying to squeeze more profit out of them by pushing them slightly upscale makes a lot of sense for Ford (GM and Chrysler, too, but that's a whole other forum). More to the point--what other choice does Ford have?

[Racin' Rick]

Stock price has to do with this:

 

 

7.24.2008

Ford's Worst Quarter Ever

Problems at its credit arm and a writedown of assets, plus a poor economy and high gas prices, led to a second-quarter loss of $8.7 billion

Ford Motor (F) reported a second-quarter loss of $8.7 billion, its worst single quarter in history.

Much of the loss was due to a writedown in the value of assets, and losses on falling values of SUVs coming off leases back to the automaker's Ford Motor Credit arm. But, like a kid who wrecks the family car and tries to distract his parents from the bad news by offering to paint the house, Ford unveiled a plan to make over its lineup with more small, fuel-efficient vehicles in the next two-and-a-half years—faster than Wall Street had expected. "

Three more quarters like this one and you can kiss Ford good-bye. Does any one beside me realize how large an amount $8.7 billion is? Try looking at it like this: $96,666,666.67 EVERY DAY FOR 90 DAYS. How is it possible for one company to be so bad in such a short period of time?

[Racin' Rick]

Does anyone here know what a PINTO is?

Alan Mulally Takes A Page From Ford's Past And Adds His Personal Touch As A Former CEO At Boeing:

 

http://www.fordpinto.com/mitzar3.htm

[akirby]

Three more quarters like this one and you can kiss Ford good-bye. Does any one beside me realize how large an amount $8.7 billion is? Try looking at it like this: $96,666,666.67 EVERY DAY FOR 90 DAYS. How is it possible for one company to be so bad in such a short period of time?

 

Maybe because $8B of the $8.7B was a one-time write-off? In other words, if Ford stayed exactly the same 3rd quarter they'd post a $700M loss, not $8B. Don't you people know how to read?