Ford's Mark Fields Sees Gold in Them Thar Small Cars
Although Ford only makes about $100 from each Focus it currently sells, The Blue Oval Boyz plan to bank big bucks from small cars. At a dinner with journalists last night [Ed: our invitation must have gotten lost in the mail], Ford Americas President Mark Fields said the small car segment is at "critical mass" and that Ford's "eager to tap it." The Detroit News reports that the formerly mulleted Mulally minion stated "we'll see a bigger smaller car segment," and wistfully added FoMoCo wants to start charging premium prices for small cars. And how will they accomplish this goal? With "exciting designs, best-in-class fuel-economy, excellent craftsmanship and innovative new infotainment technologies." And even though the Fiesta will be hecho en Mexico, the Mother of All Union Payoffs (a.k.a. the health care VEBA deal) will save Ford enough money that they can finally build small cars at a profit. Of course, the first thing they have to do is convince the average American small car buyer that a Ford small car is worth the same money as a comparable model from Honda or Toyota. [Ken Elias' Ford Death Watch later today.]
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I read this article in the Detroit News this morning, and I quickly became bored reading about Mark Fields' fluff. Seriously, how much is he willing to stay on track with the Euro Fords if he's the one who championed the Flex (which hasn't even sold 3000 models yet)? But then I became un-bored after reading the very last words of the article: "Fields said a new pact with the United Auto Workers union expected to save millions in retiree healthcare costs will also help improve the equation for small cars." First of all, how do those even relate, and SHOULD they relate?? So...Fields was talking about how the perceptions Americans have about small cars was finally changing, and that jacking up the prices for them is next on his to do list. If you really think about the above quote, what Fields is really saying is that Ford gets to pay less for healthcare even though they promised otherwise...which will improve the "equation" for small cars. I guess this could be taken as now since they chumped their employees they have a chance to pour money into their Euro Fords...but I took it as Fields saying something like "our employees will have to spend more on their health out of their own pockets, thus, in turn, forcing them to buy Ford's small cars instead of the larger ones." Maybe I'm thinking too much, but I really don't think Mark Fields is truly behind making their new small cars changing the perception of the 2.8's small car offerings.
Ford can make money on small cars, all they have to do is file chapter 11, and restart the company under a different brand name to fool the customers into thinking they're "All new and improved !" like Ford and GM do with their cars models. Maybe they could pimp up the interiors of their cars to make people think they're getting something snazzier for their money ?. Either that, or the could start putting MINI badges on their small cars and selling them at a big markup. How about an electric car to compete with the Volt due out in 2010(ish).....they could call it the Ford Futurion. ;)
Such Foresight - a bit like closing the gate after the horse has bolted!
Well, it sounds like a good idea in theory...but the problem is that Ford basically gave up on the small car market with the 2005 Focus, which was decontented (tilt and telescoping steering wheel was part of an option package, for instance), and basically ceded the small-car market to the Japanese and Koreans. And of those two, Ford (and the Japanese, for that matter) needs to worry about the Koreans, who made quality improvements in leaps and bounds. Instead of making a big deal about the Fiesta, Ford made a BIG mistake when they didn't bring the Euro Focus to market here - a bit ironic, seeing as the Focus was SUPPOSED to be a true "world car".