Advertisements
Ford's Going Further

Ford's Going Further

Ford's Going Further

As some of you might know, I’m a Detroit homer for life. I’ve been in California for the better part of 12 years now, but I was born and raised in Motown. I will always root for the home teams: the Lions (yeah, yeah, I know), Pistons, Tigers, Red Wings—and General Motors, Ford, and Chrysler (sorry, I’ll never get used to Fiat Chrysler Automobiles).

When things looked bleak for Detroit’s Big Three during the Great Recession, it was tough to watch and even tougher to see people rooting for them to fail. In no way was I ignorant of the disastrous decisions, decades of mismanagement, and inferior products that helped lead them to the brink. But I believed they would make good on their second chances. The results have been uneven, but close to a decade later, I firmly believe the automotive landscape is better off with them still a part of it. I believe a world with Corvettes, Mustangs, and Hellcats is an inherently better one.

We are rapidly approaching another reckoning, however. It’s a fundamental shift in how humans interact with cars, one that will serve as the ultimate test not only for the
traditional domestic automakers but also for every global player. And this time, not everyone will survive.

Ford’s recently announced plan to shed most of its sedan production, including the Fusion, Focus, Fiesta, and Taurus, can be viewed in a number of ways. Our Jamie Kitman takes the critical tack in his column (hard to believe), scolding Ford for going back on promises of making more fuel-efficient cars and selling out for short-term profit.

In some ways, I believe Kitman is correct. This decision is about the short term, but only in the sense that Ford needs to batten down the hatches, to gather the cash it needs to make it through the next 20 to 30 years. Does anyone at Ford really believe that selling heavier, less efficient, gasoline-powered trucks and crossovers is the way forward? Because if they do, it’s probably best to just go ahead and shut things down now. But I believe the Blue Oval is making the move to help ensure its long-term survival as we enter a new era of mobility.

Like the rest of the industry, Ford has been stung by Tesla’s runaway success on Wall Street and by its charismatic CEO, Elon Musk, who has become the pied piper for a battery-electric-powered future. Ford’s stock continues to be mired in the low teens. Tesla stock, other than a few hiccups brought on in part by its much-hyped production issues, has remained near or above $300 all year—and it has been even bigger at times from a market capitalization standpoint than Ford and GM. It must be extremely discomforting and disappointing to see it unfold from Dearborn.

But despite some of its legacy production and perception issues, Ford has massive advantages of scale and is investing $11 billion into future propulsion and technology efforts. That’s a hell of a lot of cash. Ford has been on the front end of hybrid tech, which more than one expert believes is the key bridge technology. Ford is also relatively big in China, a market that demands a strong EV game, though it has been struggling there a bit lately.

You can rail against crossovers all you want, but what was Tesla’s second vehicle? Yep, a crossover. What’s next after the Model 3? I’ll give you one guess. But don’t get it twisted: I’d much, much rather drive a car like the Focus RS, a Fiesta ST, or a Fusion than an Explorer. Taurus SHO for the win!

For whatever reason, that’s not what the rest of the U.S. or the rest of the vehicle-driving world wants. They want a perception of more space, safety, and a higher ride. For now, gas prices make that more easily attainable, and regardless of whether buyers have been pushed in that direction by clever marketing, it’s now nigh impossible to put that bus in reverse. Sooner or later, the petroleum house of cards will fall, and when the music stops, where will Ford be?

People freaked out, literally throwing away less fuel-efficient vehicles for tiny gasoline sippers when gas prices spiked well past $4 per gallon more than a decade ago. If something similar were to happen again and gas suddenly pushes up to $10 per gallon right as Ford kills off its cars, there will be trouble. But this was a bet on the long game, a way of preparing for the inevitable shift to come. If it’s anything other than that, I’ll turn it over to Kitman.

The good news, if there is any? A new GT500 is coming!

Published at Sat, 09 Jun 2018 20:05:39 +0000

No Responses

Write a response

Social Media Auto Publish Powered By : XYZScripts.com