By on July 1, 2008

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Oil prices have just hit record highs. Talk of recession is in the air. Ford’s line-up of bloated, heavy vehicles is piling-up like cord-wood on the dealer’s lots. The only car selling: its “Americanized” global compact. Ford stock is in the toilet and bankruptcy rumors are swirling. The top exec hired a year earlier is intelligent, unassuming and straight-talking. He commits Ford to building “higher quality products with stronger customer appeal… emphasizing smaller, more efficient cars.” Ford in 2008? No, it’s 1981.

Like current Ford CEO Allan Mulally, Donald E. Petersen was an atypical choice when he was promoted to the Presidency by the Ford family in 1980. An engineer, development executive and genuine piston-head, Petersen was also the antithesis of Lee Iacocca, whom he replaced. Never in modern history has an automotive CEO been so devoid of spin and hyperbole. No wonder Ford of the eighties looked to Japan for inspiration.

Petersen learned of Toyota’s use of quality guru Edward Deming. In the first coherent US automaker assault on “total quality,” Petersen adopted Deming’s techniques, and those of corporate guru Peter Drucker. As measured by owners, Ford’s vehicle quality improves 60 percent from 1980 to 1987.

The aerodynamic 1983 T-Bird launches a dynamic wave of efficient, exciting and successful passenger cars. The Turbo-Coupe has the world’s first fully computer controlled (EECV-IV) integrated turbocharged fuel injected engine. The Ranger successfully takes on the long-established Japanese compact pickups, becoming the category best seller for many years. The Fox-body Mustang’s balance of light weight and V8 power at an affordable price reinvents and dominates the pony-car class.

In the biggest single auto product gamble in modern times, Ford launches the 1986 Taurus. It leapfrogs the competition, and sets the packaging and dynamic standards for the modern US-market sedan. For sells 400k Tauruses per year, grabbing the best-seller crown from the Honda Accord by 1992. Petersen employs Japanese “just in time” production methods at Ford, and the Atlanta Taurus factory becomes the most efficient auto factory in the US (including Japanese transplants).

Petersen’s honest, cooperative, non-political management style motivated FoMoCo’s management ranks as never before. His deep experience in car development as a car enthusiast ensurfed that Ford’s products were consistently more dynamic than their competition.

In trend-setting, car-conscious California, Ford becomes the number one selling brand. The Blue Oval Boys’s passenger cars sell well in The Golden State; GM and Chrysler have already become irrelevant (except for trucks and Corvettes). Ford’s profits explode. In 1986 and 1987, Ford was the most profitable car company in the world. As its stock ascends from around $1 in 1982 to $17 in 1987, “F” becomes a Wall Street darling

But what really separates Petersen from the rest of his ilk: he maintains perspective, candor and modesty– despite the phenomenal success that was his doing. It’s a stark contrast to Chyrsler’s Iacocca, who had to be dragged out of Chrysler kicking and screaming, well past his sell-by date. And then tried to weasel his way back several more times, Petersen consciously and quietly retired two years early in 1990 at the age of sixty-three. He wanted a new management team to have a running start dealing with the clouds he clearly saw gathering on Ford’s horizon.

In an exceedingly frank and prescient farewell discussion with thirteen journalists the day before he retired in 1990, Petersen expressed grave concerns about the future of the U.S. auto industry. According to one reporter, “his terse answers were sobering. The word survival came up a lot because it’s no joke to ask how much of a home-grown auto industry will exist a generation from now.”

“Because of the deep partnerships of the Japanese companies with their suppliers, changes can be implemented predictably and rapidly. The steady loss of state-of-the-art manufacturing technology in the US manifests itself in the longer product cycles and lower real or perceived quality of the domestic automakers… There’s this nibbling away, this gradual erosion that’s occurring that nobody sees very well, I don’t think. It bothers me a lot.”

Petersen ended with a warning that “the manufacturing sector in the US is going through the same process now as the agricultural sector went through in prior generations… we have to accept that it (manufacturing) will generate a far smaller percentage of the employment of the people of the United States than it does now or did 10 years ago. There will be far fewer jobs.”

Those words spoken eighteen years ago seem remarkably prophetic (“how much of a home-grown auto industry will exist a generation from now?”) ,especially during Ford’s current déjà vu crisis. Alan Mulally has charted a very similar course for Ford’s salvation, emphasizing efficient European cars and quality. Will the same medicine save Ford a second time?

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45 Comments on “Ford’s Déjà Vu Moment, Part 1...”


  • avatar
    Rix

    Petersn started in 1981. Taurus in 1986. Does Mulally have five years to fix Ford?

  • avatar
    gamper

    I really believe that Ford is on the right track, unfortunately time now becomes the most important factor, as in Ford is running out of time. Should be very interesting to see the future product announcements that are coming in July as part of Ford’s emergency reaction to the current market conditions.

  • avatar
    John Horner

    What a great piece Paul. Here is a fascinating article from 1986 giving a glimpse of how the man worked:

    http://findarticles.com/p/articles/mi_m1316/is_v18/ai_4473382/pg_1?tag=artBody;col1

  • avatar
    Ralph SS

    Just a thought: a second article about how they lost their way to find themselves in their current position would be an equally compelling read.

  • avatar
    seoultrain

    Ford turned a profitable 1Q this year. Have they kept the ball rolling in the second quarter? Sales numbers are falling, but if they can stop hemorrhaging money, they’re in great shape. If they keep small profits for a few years until the true world cars arrive, they will make a killing. Add in GM and/or Chrysler going under, and Ford may be able to give Toyota a scare.

  • avatar

    Carmnesia: n, a total loss of experiential memory resulting in new platform development that is disconnected from real world benchmarks, leading to a repeat of past mistakes.

  • avatar
    Steve-O

    Excellent piece, Paul. I have always been a fan of Ford-of-the-80’s. Under Peterson, they operated like a company that chose to fight hard to survive and thrive through dynamic products. They were an easy company to root for… I see glimmers of Peterson in Mulally. Time will tell.

    Oh, my souvenir from those days which I am still proud to own: my 1984 Mustang SVO.

  • avatar
    Gardiner Westbound

    If Ford quality improved 60-percent from 1980 to 1987, earlier ones must have been abysmal. We couldn’t keep our 1987 Ford out of the shop.

  • avatar
    Alex Rodriguez

    I think Mullaly was a great choice to lead Ford and am hopeful that he can do the job.

    But I find it interesting that Jim Press doesn’t get any love from these parts. Nardelli might have the title but he is really a warmed over CFO with some power. Press is the guy who has the reigns of the auto business and is building it back up from the shambles that DCX left it in.

    So why has everyone become so hopeful that Ford is going to be the one that makes it, while Chrysler is everyone’s punching bag?

  • avatar

    Thanks, Paul. This is an excellent piece reminding us that any business is finally just about the product.

    In 1986 I bought an Acura Legend. At around $20k, it was a superb car and finished beautifully. A year later, my oldest son learned to drive and I found a relatively low-mileage 4-cylinder 5-speed Taurus as a car that he could use while in high school. While the Taurus was inexpensive (original list price was $11k), I was really impressed with how well it drove. It did not have the reliability of the Acura, but it wasn’t a bad car at all. As I recall, Explorer sales began to take off in the late ’80’s and Ford took their eyes off the Taurus based on its ongoing success.

    Had Petersen’s successor spent time to refine the Taurus, as Toyota did with the Camry and Honda did with the Accord, we might still have a Ford at the top of the best seller list. Ford spent $2.5 billion in 1990 to purchase a troubled Jaguar which could only absorb money; imagine the same amount spent on Taurus refinement and its affect on today’s bottom line.

  • avatar

    Excellent work, Paul. I’d also like to see the follow-up piece about how things went downhill after Petersen left.

    FYI, there is a typo or something leading off the third paragraph:

    “Peterson learned of Toyota’s use of quality guru Edward In the first…”

    Is the word ‘Deming’ and a period missing?

  • avatar

    Chris: My bad. Text amended.

  • avatar
    Justin Berkowitz

    @Alex Rodriguez: You ask a great question. I can't speak for anyone else, but I can explain my own view of Ford being likely to make it and not being fond of Chrysler. 1. Ford's current lineup of cars in North America are, inherently, pretty good vehicles. Some of them are absolutely superb (Flex, Mustang Bullitt), others are very good (2009 Escape Hybrid, Fusion/Milan, Taurus). The dying Explorer is in and of itself excellent. Contrast with Chrysler, which makes maybe 2-3 products I actually like: the Wrangler is by far the best, and I do like the LX cars (Charger, 300) despite bad interiors and sorely lacking safety features, as well as the new Challenger. 2. Ford has very appealing products in the pipeline, including the Focus and Fiesta. Many TTAC commenters and other car enthusiasts just like the idea of foreign fruit, whether or not it's reasonable. Contrast with Chrysler. What's coming from them next? The Challenger is out, next the 2009 Ram and … ? 3. Ford appears to have humility. (They said the current Taurus is Homer Simpson's car, e.g.) Chrysler may have some internal humility – they acknowledged the interior of the Sebring is embarrassing – but on the outside, they continue to put out press releases about how much ass they are kicking. 4. The "Let's Refuel America" ads make me want to puke. 5. I have a hard time trusting a company run by Bob Nardelli, who walked off with $360 million in compensation after shareholders (i.e. owners of the company) said they wanted his income to be more tied to the performance of the company and he refused.

  • avatar
    netrun

    Having worked on a few hundred Taurii, they weren’t the highest quality vehicles out there. Everything seemed designed to rust. Door handles left rust streaks on all the doors. The underbody corroded as if it had been left in a salt bath. And dear God I hope you didn’t have to remove the rear brake drums!

    But they were popular to the point of invisibility. When the Accord started beating it in sales again, you knew Ford had stopped paying attention a while back. Sad, really. Other than the F-150, what other real hit (400k sales) has Ford had in the intervening 20 years?

  • avatar
    ivorwilde

    Great story but DEP might be upset. It’s Petersen, not Peterson. I remember interviewing him several times when I was an automotive writer for a once-great newswire. He was dry as dust but knew the business well. With Iacocca at Chrysler, it was ask one question and get a 59-minute answer full of color and quotable quotes, but presto! your time was up!

  • avatar
    Alex Rodriguez

    @Justin Berkowitz

    Fair Enough. Thanks for your response.

  • avatar
    umterp85

    @ Alex Rodriguez…So why has everyone become so hopeful that Ford is going to be the one that makes it, while Chrysler is everyone’s punching bag?

    Just some additional thoughts based on your question…Probably some bitterness over the government bailout, the period of German ownership, and a much smaller core of nameplate enthusiasts…I just do not see the same historic passion for Mopar that I see for the other American names.

  • avatar
    geeber

    Interesting article…the sad part is what happened later.

    Ford let the Taurus rot on the vine, and waited far too long to address the head gasket problems with the 3.8 V-6, and the fragile automatic transmissions used in the Taurus/Sable/Windstar. Hundreds of thousands of customers were burned by that drivetrain – easily the worst to come out of Detroit since the Oldsmobile Diesel – and Ford’s passenger car business arguably never recovered.

    The Duratec V-6 ohc engines should have been out by 1989 or 1990. The Taurus would have been much more competitive with the Accord and Camry if it had boasted a modern ohc engine.

    With the second-generation Escort, Ford based it on the Mazda platform, which resulted in a much-improved product that was the best of the domestic small cars. Using Mazda components and technology to produce a competitive small car was a much smarter strategy than the one GM took – setting up an entirely new division, Saturn, that has lost money every year but one since it began building cars. How much of this was Don Petersen’s idea, and how much was driven by Red Poling?

    Also, was Petersen the one who gave the go-ahead to bring out a what eventually became the Ford Probe as the next-generation Mustang? Only the outcry from Mustang loyalists halted that move, and forced the company to begin work on the revamped 1994 model, which was still based on the Fox platform.

    The parallels between 1981 and 2008 are interesting, but Mulally has even less room to maneuver, as Toyota and Honda are MUCH stronger today than they were in 1981. In the early 1980s, they hadn’t yet invaded the luxury car or family sedan markets. And there were more people willing to give the domestics a second chance.

    netrun: Other than the F-150, what other real hit (400k sales) has Ford had in the intervening 20 years?

    The original Explorer was a huge success. In retrospect, it was probably too much of a success, as it lulled Ford into thinking that it could get by on light truck profits. This line of thinking basically handed the passenger car market over to the Japanese.

  • avatar
    mel23

    Given what Honda and Toyota have in the pipe in the way of hybrids, if gas stays high or goes higher I don’t see how anybody else can stay with them.

  • avatar

    Doh! Text amended.

  • avatar
    cleek

    @ mel23

    Fearless prediction: As in Europe, Turbo Diesels will end up eating the hybrid’s lunch. The TDIs, albeit with enviro-mods, will be significantly more profitable and flexible than the Hybrids.

    TAlso, there is plenty of domestic coal that can be processed into diesel.

    Doesn’t most of the world’s lithium come from Central Asia? OLEC anyone?

  • avatar
    unleashed

    mel23: Given what Honda and Toyota have in the pipe in the way of hybrids, if gas stays high or goes higher I don’t see how anybody else can stay with them.

    Same here.
    The Ford’s new Focus, Fiesta and Fusion are all fine and very competitive cars. I just can’t imagine how those low margin models (compared to their traditional but failing Truck/SUV cash cows) will allow Ford to become profitable enough in order to sustain the next rounds of R&D.
    Toyota and Honda are already light years ahead in the new tech development…

  • avatar
    Paul Niedermeyer

    Alex Rodriguez: But I find it interesting that Jim Press doesn’t get any love from these parts

    I have never actually dissed Press, but I have a theory about him. It requires understanding of how Japanes companies work: decision making is by consensus, and the group dynamic is critically important.

    My theory is that Jim Press is not an exceptionally gifted executive, but happened to be in the right place at the right time when he started with Toyota decades ago. He obviously fit in, and was able to work with the Japanese well. But how much credit does he deserve for Toyota’s success in the US these past thirty years? A good question, but perhaps not as much as some (Cerberus) might think.

  • avatar
    John Horner

    “Ford spent $2.5 billion in 1990 to purchase a troubled Jaguar which could only absorb money”

    As much as I admire what Petersen did at Ford, the sad truth is that he was the guy who got Ford into a bidding war with GM for Jaguar, and won …. er, lost.

    “As in Europe, Turbo Diesels will end up eating the hybrid’s lunch.”

    I used to think that as well, but as long as Diesel fuel remains priced way, way above Regular Gas in the US the diesel car remains doomed.

    Technologically the one thing a hybrid can do that no straight diesel can pull off is regenerative braking. So for non-highway driving the hybrid is going to retain a significant efficiency advantage. I suspect we will see taxi-cab fleets move to 100% hybrids over the next 5-10 years.

  • avatar
    Paul Niedermeyer

    John Horner: As much as I admire what Petersen did at Ford, the sad truth is that he was the guy who got Ford into a bidding war with GM for Jaguar, and won …. er, lost.

    It was William Clay Ford who had a royal hard-on for Jaguar, and pressured Petersen to buy it. He had lusted after it for ages, and when it came on the market he couldn’t resist the temptation.

  • avatar

    i remember 80’s fords: my old dad in a fit of madness bought a ford fairmont station wagon with a four-speed four banger. a hopelessly awful car. i remember being unable to get it up the ramp of the underground carpark in my building with a couple guitars & my two mates in the back – it didn’t have the power. my mates had to get out & run up the ramp beside that fine bit of ford engineering …

  • avatar
    drifter

    Fearless prediction: As in Europe, Turbo Diesels will end up eating the hybrid’s lunch. The TDIs, albeit with enviro-mods, will be significantly more profitable and flexible than the Hybrids.

    American public is not stupid enough to pay 20% premium for diesel engine and 25% premium for diesel fuel. Besides, diesels are in decline in Europe currently.

  • avatar
    truthbetold37

    This is why Mark Fields shouldn’t be in the position he is in. You always see him with that sh*t eating grin that you want to knock it off. He has no clue what he is doing and will only undermine Mullaly.

  • avatar
    windswords

    They say that history repeats itself. You can find examples of this kind of thing if you look enough. Here is one from Allpar I removed the references to the exact year:

    “In a time of retrenchment… sales sank deeply in the wake of the energy crisis, for most auto manufacturers in America. At Chrysler that was very much the case, despite a completely redesigned crop of models… Indeed, sales for most of the models … dropped … and a two-month backlog piled up. Despite that, _____ refused to cut prices, cutting production instead.

    By early _____ of ____, sales for Chrysler were down 34%, while GM was down 43%. In desperation, Mr. ________ did something no one else in Detroit had ever done before: instituted cash rebates, essentially paying people for buying a car. While it must have galled him, since it meant throwing money away, it was necessary to move product. The big inventory that was setting around had been costing Chrysler $xxx,xxxx a week – a lot of money…

    To get through ____, Mr. ________ had to make a painful decision. He closed most of the factories for a month to reduce the glut of cars, setting on the lots of Detroit, or on dealer lots, around the country.”

    Sound familiar doesn’t it? This was about Lynn Townsend in 1974 and the first energy crisis.

  • avatar
    WalterRohrl

    Justin Berkowitz :

    5. I have a hard time trusting a company run by Bob Nardelli, who walked off with $360 million in compensation after shareholders (i.e. owners of the company) said they wanted his income to be more tied to the performance of the company and he refused.

    Justin – While I am hardly a fan of Nardelli’s, it is not really fair to imply that he walked off with $360 million of his own volition. What actually happened is the BOARD of HD gave him the money to leave. Big distinction there. If someone gave me the choice of either tying my pay to my company or walking away with more money than I could ever spend, well, maybe I’m shallow, but I’d take the cash too. What is truly sickening is that there was not a wholesale shareholder revolt.

    Jim

  • avatar
    jerry weber

    Deapite the nice piece on Ford, they are along with Chrysler the most un-even of car makers. They can be brilliant and cluless at the same time. Ford is a company that depends on blockbusters. The T, A, V8, mustang, taurus, explorer. But they never put together a coherent full line of products. During these times of blockbusters, there was the blockheadedness starting with Henry not changing the T. Then the Edsel, weak sister Mercury (especially since the 80’s), and a Lincoln brand initially weak strong in the 80’s and 90’s and now irrelevant. There coordination and follow through were worse than GM and kept them in second place for most of their history. How can you save Jaguar Rover, & Volvo when you can’t save Lincoln-Mercury? With just three domestic lines, low, medium & high, Ford should have been the efficient and sensible line up of cars for America. At least GM had a 40 year successful run of their five brands. Ford never had that luxury. If Mullaly can now just salvage the Ford brand, he will be a hero. I don’t know how good he really is, and because of the dreck he was left with at Ford, Mullaly may not have time enought to clean it all up. How do we expect these new auto execs to win for the home team when they are always batting in the ninth with two away and four runs behind?

  • avatar
    Macca

    Geeber:

    “Interesting article…the sad part is what happened later.

    Ford let the Taurus rot on the vine, and waited far too long to address the head gasket problems with the 3.8 V-6, and the fragile automatic transmissions used in the Taurus/Sable/Windstar. Hundreds of thousands of customers were burned by that drivetrain – easily the worst to come out of Detroit since the Oldsmobile Diesel – and Ford’s passenger car business arguably never recovered.”

    How true. I actually first became a huge fan of TTAC when an editorial ran lamenting the death of the Taurus. I posted a huge essay-length reply in the comments section about growing up with a Ford-loyal father and his move to Japanese autos.

    He went from cursing the ‘jellybean’ shaped first-gen Taurus to owning two (a 1986 LX and an ’88 L) – and then went on to buy an ’89 Cougar LX and ’93 Thunderbird LX (both with the 3.8L Essex V6), and a ’93 Ranger. The ’86 Taurus was showing signs of transmission issues when he unloaded it a few years later, and the ’88 experienced total slippage when shifting into 2nd gear prior to 100k miles. Both the Cougar and TBird experienced the infamous 3.8L head gasket leak, resulting in complete engine failure, twice (!) apiece.

    The ’93 Ranger (2.3L I4, 5-speed) was the picture of reliability, quality, efficiency, and durability, serving my oldest brother for quite some time without a hiccup. I still miss that little truck.

    Ford (under Petersen) did achieve an amazing turnaround in the ’80s, but unfortunately the overall quality was still lacking even before they allowed the cars to gather dust in the shadow of the Explorer. A shame, too, because all of those cars had nice features and design for the money.

  • avatar

    Given what Honda and Toyota have in the pipe in the way of hybrids, if gas stays high or goes higher I don’t see how anybody else can stay with them.

    So true. Toyota’s releasing the next-gen Prius, the Highlander Hybrid, a possible Tundra hybrid and possibly a compact truck based on the RAV-4 underpinnings using a hybrid engine.

    Ford has the Escape. And only the Escape. And no coherent plans for another hybrid in the future.

    (Edit: Oh yeah, the Fusion hybrid.)

    If Mullaly can now just salvage the Ford brand, he will be a hero. I don’t know how good he really is, and because of the dreck he was left with at Ford, Mullaly may not have time enought to clean it all up. How do we expect these new auto execs to win for the home team when they are always batting in the ninth with two away and four runs behind?

    The only way for Ford to survive longer than Mulally’s stay is for the company to develop a good system for choosing management and workers. It seems to me like almost every time Ford has a major problem it can be traced back to the Ford family, or choices they made in other staffs. For example, Henry’s keeping the Model T too long even as others in the company were begging him to update the thing), Bunkie Knudsen being hired over Iacocca and doing damage to the Mustang in the ’70s, Bill Ford’s greenlighting all the SUVs we’re seeing today, etcetera.

  • avatar
    rocket

    I will NEVER buy another Ford.
    I got burned by the Taurus too.
    I had the 3.8L and the headgaskets blew, the trans slipped and it leaked steering fluid, bad breakes. Terrible car.

    Taurus killed Ford 10 years ago.
    I think Ford is already dead, but it´s like in one of those Horror movies where the zombie just keeps walking around for a few more days before actually dropping to the ground.

    P.S.-I fixed my Ford, I got a Chevy :)

  • avatar
    James2

    After experiencing the 1980 Mustang, a world-class POS, my dad said he would never buy another Ford.

    However…

    As part of his job, he bought company cars and one of them was a 1992 Taurus wagon. He liked it so much that he bought it from the company. A few years later he gave the wagon to a friend and bought a 1996 Taurus wagon from the company.

    To me, the 1996 Taurus was a lousy car from a fit-and-finish perspective, and it felt like the 3.0-liter Vulcan V6 had pistons made of heavy lead, this engine just didn’t like to rev.

    Anyway… the moral of the story is times change and the product improves, if incrementally.

  • avatar
    FromBrazil

    As others have said, I agree that Ford has the best chance of surviving the current mess. As other have also said, Ford must focus on their products, continuously and over an extended period, guaranteeing reliability. I think that they don’t need to be the best at anything but they MUST be in the top three slots of any category we use to compare cars (performance, economy, design, technology, price etc.). In short, they need well-rounded, well-thought, well-executed cars.

    But I disagree they need a new Taurus. This time around they need a new SMALL car. One with an engine below 2L. If Honda can do it with the Fit, BMW with the Mini, Toyota with the first Xb, why can’t Ford?? They have a fine, strong, refined, economic (and could be even more so with some variable valve lifting technology) 1.6L engine in Brazil and Europe. The Zetec Rocam. Just stick that thing in everything from the Focus on down.

    And they need the new Fiesta and even the new Ka in NA sooner rather than later. The Fiesta must be made there, and the Ka could be imported from Brazil in lower quantities initially, but with some strong marketing support it could make it in NA due to its tremendous potential for being the new generation’s “it” car. Economical, frugal, stylish, environmentally-friendly, technologically-savvy, endlessly customizable. I think it could really strike a chord with the newer generations. Just be sure the interiors are up to par.

    A Ka with such an image would steamroll the yarises, scions and whatnots of this world. A case study to show Ford how to do this right is for them to just see the kind of reception the Fiat 500 is getting in Europe. With the grain of salt necessary when reading Jeremy Clarkson’s hyperbole, he gives us a good image of what can be done with such a car when the marketing, production and follow through are done well. Clarkson wrote that this year at St. Moritz ultra posh ski town the “it” car was the 500. R8 yawn! Been there done that. The Bentley, yawn, overwrought. Land Rovers and whatnot, yawn, yawn, so last-turn-of-the-centuryish.

    And the Ka being so small and light can even get away with even smaller engines. In Europe there are 1.2L (not recommeded for America) and 1.4 L engines (could make it in America, and specially Canada).

    Maybe I’m just daydreaming, but once bitten by these high gas prices, I think it would take at leat a decade of gas bellow the 2 dollar mark for consumers to go back en masse to big hinking V8 behemoths.

  • avatar
    Dynamic88

    I join the chorus of voices asking for a follow-up on how Ford lost it’s way after Petersen left. Why do these guys always take their eye off the ball?

    I don’t want to take any credit from Petersen, but he simply did what any good auto exec should have done. When that happens at Ford, it’s an exception, and newsworthy.

    Meanwhile, ToyHon kept making good decissions all along, but there is article about how ToyHon in the mid ’80s was making good decisions, developing and building good products, etc. It’s the occassional wrong step, the occassional slow selling model that has to be killed off that seems newsworthy when looking at ToyHon.

  • avatar

    Great article Paul. You could be making all this up off the top of your head, for all I know, but your writing carries it :-)

    cheers

    Malcolm

  • avatar
    windswords

    The Luigiian:

    “The only way for Ford to survive longer than Mulally’s stay is for the company to develop a good system for choosing management and workers. It seems to me like almost every time Ford has a major problem it can be traced back to the Ford family…”

    Ding ding ding ding! You win the prize. That has been my observation of Ford all these years. That and the fact that they seem to spend more money developing a car than either GM or Chrysler, and let’s not talk even talk about the Asians. That’s why I think they are in such a precarious position. They can’t go C11 (shares become worthless), they can’t be bought by another company (too big, Ford family doesn’t want to give up control, and who would want them anyway?), and they can’t even manage their own brands let alone (the former) PAG. They can’t even hold onto their good employees. The guy that did the current Mustang was shown the door wasn’t he (I thought I read that here)? They got rid of Lee, but worse than that they got rid of Hal Sperlich. Hal who? He was one of the product guys working under Lee. His team came up with the idea of a new small van. Yep, Ford had the minivan concept first. But since Hal was a friend of Lee, Henry (he of the Ford family) gave him the boot. So he went to Chrysler. The rest as they say…

  • avatar
    menno

    I’m starting to wonder now, after the June numbers, whether Ford will survive. At all.

    I’d been lulled into thinking that Ford had some better chance than GM and Chrysler, but I’m starting to doubt it.

    I had a Taurus, and it was a somewhat unreliable used car, but not abysmal. I did sell it when I thought the head gaskets on the Vulcan 3.0 might be getting weak, after dropping about $300 into having the ignition switch fixed (at a time when $300 was a VERY significant cash outlay for me, with crap jobs/crap economy/crap northwestern Michigan pay, two kids, having just bought a house instead of renting, etc).

    My low point was later getting a used 1990 Lincoln Town Car with the first year OHC V8. It had good points – roomy, quiet, real good MPG on the highway (given the size and weight of the thing). But the reliability was poor, small things broke a lot, and it left me stranded. Several times. I got it and it only had 50,000 miles.

    Even the craptastic 1984 Pontiac 1000 (badge engineered Chevette) I bought new way back was a better car, really. So that’s when I thought “wow, if this is the best Ford can do on the top-of-the-line car with only 50,000 miles on it, I’m done with Ford”. And – I am. “Never more.”

    Unfortunately, NOBODY and I mean NOBODY was even interested in taking a 7 year old Town Car in trade until I snagged a 0% over 5 year deal on a new 1997 Chevrolet Cavalier (which was my LAST ever GM product), after which I traded it off on a new 1999 Dodge Neon (which was my LAST ever Chrysler product).

    I’d run out of car companies so ended up taking what I considered to be a huge chance on a new 2002 Hyundai Sonata, which ended up “better than average” (but significantly better than any Detroit crap I’d ever owned), and we’re now on our 2nd Sonata (as well as our 2nd Prius hybrid).

    At least now I know I will get where I’m going when I get into either of our near new cars.

  • avatar
    BKW

    Once when Petersen was addressing a press conference, a reporter asked “If Quality is Job 1, what is Job 2?”

    Petersen stood there dumfounded, couldn’t think of a thing to say.

    When Iacocca first viewed the 1986 Taurus, he said “It looks like a flying potato!”

    Y’all forgot to mention the crappy brakes the first generation Taurus/Sable had. The brakes got so hot, the calipers melted. The rotors were defective from the get go. Ford replaced them four times, none of those updated rotors solved much of anything.

    The auto/transmissions were terrible, but not as bad as the A4LD’s used in Bronco II’s and Rangers. These were so bad, some dealers only sold these two vehicles with 5 speed manuals (which by the way were either from Mazda or Mitsubishi).

    The absolute WORST autotranny Ford EVER made was the AOD used in Crown Vics, Lincolns, Grand Marquis, F150’s, and others.

    Nothing before or since was worse. AOD = A horrid POS!

    The problem was…ppl drove these cars in O/D in heavy stop and go traffic. This caused the trans to shift up/down, in/out of O/D. Sooner or later, usually sooner, the trans fried.

    The warranty costs to fix the terd was more than all the other autotrannies warranty costs COMBINED!

    With all these problems and more (this is just the tip of the iceberg), it’s no wonder ppl bought Honda’s and Toyota’s, by the 1000’s.

    Ford has only themselves to blame for the fiasco they’re in now. If they had made a better product..ONCE, they wouldn’t be in the position they’re in today.

  • avatar
    Landcrusher

    Nice article. You said a LOT in a few words.

    I always come back to a similar point when I think about Ford. It seems their saving grace is that they make desirable vehicles. That is why there is hope for them. When Chrysler came out with their new styles, they also had a chance, but the reliability was so low that it rubbed off on the new nice styling. Now they haven’t updated that either!

    There is something (actually many things) about the domestics that consistently makes them fall into complacency, and they need to get a handle on most, if not all, of them. Yesterday.

    Maybe like Ford did then, it’s time for big gambles. Perhaps GM needs to double down on the Volt. Ford and Chrysler need similar ideas. They are all so short stacked that if they don’t make big bets, they will be out of the game soon enough anyway.

  • avatar
    CarnotCycle

    edgett said:
    Ford spent $2.5 billion in 1990 to purchase a troubled Jaguar which could only absorb money; imagine the same amount spent on Taurus refinement and its affect on today’s bottom line.

    This Petersen guy retired in 1990, and the same year Ford shelled out some cold cash for a cat on life number seven.

    That would be an interesting timeline, if it could be established that within months of Petersen retiring, the Corporate Tool that undoubtedly replaced him had already started throwing Ford under the bus. Does anyone know that timeline; Ford’s activities in that regard circa 1990?

  • avatar
    HEATHROI

    that “Corporate Tool” was one Harold A (Red)Polling, long time Euro Ford Guy, another from the finance “le cost cutter” school of managagement.
    He wanted the burden of Ford’s health care costs to be cheerfully picked up by the taxpayer via the ever helpful US Congress. (1992)

    next up to the poisoned chalice was the englishman (magic)Alex Trotman (96) did some good work in standardizing ford cars world wide. Everywhere that is except North America.

    Then of course came Jac the Knife (99)who admirably succeeded in pissing everybody off except of course Carlos Ghosn who is said to be a friend.

    Billy Ford took time off from being a rich dilettante (When you are a descendant of Hank F. and Harvey Firestone, you aren’t really having to apply at the Home Depot kiosk for a job) claimed to be an environmentalist (‘hey Bill, where was the the electric ranger that someone could buy from one of your dealerships?) and amateur Ice Hockey champ for the ford team.

    after 4 years at the top Bill found the strains of being an auto exec weighing him down. the new guy appears to panning out but the next couple of years could be ummm interesting.

  • avatar
    GS650G

    I think Ford is buoyed by Mazda to some degree. Their cars are respected, sell well, have good performance and get good gas mileage. The badge engineering needs to be stopped but Mazda gets the new market realities.

    Ford at least makes a real hybrid car and is showing promise with its latest offerings like the Flex. The F-150 must still be made but Ford needs to let go of the idea that they need to build and sell as many as before.


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