By on July 9, 2014

Bill Ford in Turkey

Sharing the pages of The Wall Street Journal’s 125th Anniversary issue with the likes of Mark Zuckerberg, Larry Summers and Taylor Swift, Ford Executive Chairman Bill Ford, Jr. sees a future for the automotive industry so bright, he’ll need to wear shades.

The chairman wrote in his op-ed for the paper that the automobile will become “part of a larger ecosystem,” and the industry must act accordingly. He explains that this challenge “represents a $130 billion business opportunity” to develop solutions to growing transportation concerns, such as a vehicle’s interactions with a city’s multi-modal infrastructure as a result of more people moving back into cities.

Ford also believes ridesharing companies like Uber and Lyft are signalling a shift from individual ownership, going as far as to proclaim the practice “may not be the primary model of vehicle ownership in the future.” He adds that future vehicles will be heavily connected with each other for high optimization of his future transportation ecosystem, noting the early phases of the connected car are already in existence.

Finally, the chairman states driving itself will need to be redefined thanks to autonomous vehicles taking the wheel — or lack thereof, in Google’s case — from the driver in more and more situations. In turn, drivers who would have handed over their keys in their twilight years would now have more time and greater mobility through autonomous technologies, as well as those with physical disabilities.

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20 Comments on “Ford: Automotive Industry Must Prepare To Rethink Transportation...”

  • avatar
    schmitt trigger

    I applaud Bill Ford’s forward thinking.

    An economy professor once lectured us during the late 70s: “In these days of declining and bankrupt railroads, it is hard to believe that railroads once had so much power during the 19th century, that they actually built this nation.
    However, their big error was that they did not realize they were not in the railroad business, but in the bulk transportation business. If they had foreseen this, today we would have Union Pacific Airways or Santa Fe Truck lines”.

    • 0 avatar

      Interesting comment by the Prof.
      Using his logic, why didn’t canal companies that criss-crossed the eastern USA become railroad companies in the 19th century?
      The answer is obvious. They could not.
      Railroads did adapt within their railroad business model. Thousands of miles of track abandoned 50’s and 60’s. Railroads abandoned passenger transport post WWII and consolidated as bulk carriers.

      • 0 avatar

        This. They started off intergrating themselves into the transportation network by hauling trailers on flatcars; this then evolved into hauling just the containers.

        The local truddling along with a mixed consist of boxcars, tank cars, flatcars, and gondolas with the little red caboose behind has been replaced by mostly container trains and unit freights hauling an entire train of coal or other commodity from one point to another; often turning around and heading back to repeat the entire process. Much fewer breaking up trains in hump yards and making them into other trains to send on to other destinations.

        And at the end of the evolution they are more profitable than ever, filling a role in the otherall transportation system that they are best suited for; rather than being the only means to get to communities that they were in the 1800s, and provider of service to anyone who wanted it in the 1900s.

        Canals on the other hand could not evolve to find their nitche in the overall transportation network, and died out.

    • 0 avatar

      Great reference, Schmitt, and I use this example often in meetings with clients. I took it from the book “Start with Why” by Simon Sinek. His basic premise is that too many companies define themselves by what they do, or how they do it. Examining *why* you do something has the potential to open many more doors.

      Another example is Apple. They no longer define themselves as “Apple Computer”, they are simply “Apple, Inc.” If you ask Apple what they do, the top leadership won’t say: “We make iPods, iPads, iPhones and Macs”, nor will they say, “we make phones, tablets and computers.”

      What they’ll tell you is “we make consumer devices with exceptional end user experiences”.

      That mindset has allowed them to build things like the iPod – a seemingly unrelated business in 2001, that became core to the whole company. That philosophy drove them to tackle the cell phone market and introduce a new way of interacting with phones: iPhone.

      We can go on and on, but the point is this: I don’t necessarily agree with all that Bill Ford is saying, but his heart and his mind are in the right place. The automakers need to keep thinking about where things will be in 30 years versus where they are today, lest they be relegated to the industrial wasteland of the past, ala the railroads.

    • 0 avatar

      Well, that’s true, but a lot of the blame for the railroad’s problems goes back to the creation of the ICC and the “trust busting” laws in the early 20th century. Those laws were pretty much a reaction to the railroads’ almost total control of most transport during the late 19th century and the money and power they had, and abused.

      The railroads basically had to get ICC permission to do do anything, and the Eastern roads were well into cannibalism by the 50’s, selling assets such as land to keep on paying dividends and make up the losses the railroad business was generating. There is still a lot of land in NW Ohio owned by the old Penn Central Company, 44 years after the RR itself went bankrupt! The Western roads, with their longer hauls, weren’t in nearly as bad shape as the Eastern roads were, but by the early 70’s, they were getting into cannibal mode too. After the really bad Eastern roads were combined into Conrail, and the rules for the rail business were made sane again, contrary to what a lot of “experts” claimed would happen, they all started making money. Reading some of the editorials about Conrail and the railroads in general druing the early to late 70’s are very funny, looking back. It was a lot of doom and gloom, talk of nationalization, etc. But, it turned out Conrail would be successful, until the NYC/PRR merger that created PC was basically undone when CSX and NS split CR, pretty much fulfilling the NYC/NW merger plans from the 50’s that the government shot down.

      • 0 avatar

        I also believe it was the ICC in part who forced the railroads to continue operating short lines and providing service to customers when the railroad would have abandoned them as unprofitable. I also think it was the ICC who also forced them to continue passenger service when it also ceased to be profitable, and they couldn’t rely on the U.S. Mail or package delivery to suppliment it.

        Once they were able to drop all that deadweight and focus on unit trains and bulk trains, they were able to make money once again.

  • avatar

    What a moron. His company can’t even figure out how to fix a defective engine the first 5 times they recall it or produce a working infotainment system. Someone needs to come down off of whatever high they’re on and join us here in reality.

    • 0 avatar

      Okay everyone, before you hit reply and attack him for this statement, I have one thing to say…

      Don’t feed the troll. Let’s have a civil discussion and move on. There’s no need reply 30 times to tell him how silly his comment is.

      • 0 avatar

        He actually has a point. Ford jusr recently managed to buy cats that don’t fall apart right away and drive like tractors. They are still far from Hondacord quality, their space use is crap etc.

        Sure people want more electronics. But they sure don’t want a car just to go to the shop.

        Funny to hear them talking about the future with self-flying and talking cars when they can’t even build a decent ignition switch.

        Ford sure improved, but don’t have an established good track record. If they work hatd they get to Hyundai level. Not sure if they ever reach Toyonda levels of quality and public perception.

        • 0 avatar

          I’ll say he has a point. Mr Ford:- “Blah, blah, blah – we’re really thinking hard about the future…blah…” Where the heck has he been for the last 30 years? Why all this sudden, deep and public soul searching? Could it be because he feels so threatened by emerging alternative transport modes that he and all his ivory tower cronies actually have to do some work for a change? My heart bleeds. MW

        • 0 avatar

          Your comment makes no sense at all. I have never heard of catalytic converters on Fords falling apart, nor do they sound agricultural.

          It is GM that is having the ignition switch recalls, not Ford. And Kia got it’s start building Fiestas for Ford, which is why their badge is also oval shaped.

  • avatar

    #1 Ride-sharing is a layer of personal transportation, but the simple fact is, most people LOVE their cars and will not share them, downgrade or “have less” if they feel they can afford more.

    #2 Highly technological communications between cars and infrastructure are eventually gonna happen, but it’s gonna take a long time and trillions of dollars that we are currently wasting in war and entitlements.

    AT CURRENT we have bridges collapsing, more traffic than ever before, underdeveloped rail services and an infrastructure that’s so dilapidated no one wants to invest in America anymore beyond building a few factories so they can build their cars cheaper due to the weak dollar.

    DETROIT is the future of America. Out of control entitlements, stagflation lack of jobs, lack of opportunity, welfare…

    If only we had an benevolent dictator with American Protectionism at heart.

    It DISGUSTS ME to look at our borders.
    It DISGUSTS ME to look at our roads.
    It DISGUSTS ME to look at our economy.

    Who will rise to restore American exceptionalism?

    • 0 avatar

      A whole bunch of people are going to have to die in order to restore it. Unfortunately no one’s pen or phone alone has the power to right the ship.

    • 0 avatar

      #1: It might be true for you, but you don’t speak for most of us. If I could trade in 2 of our 3 cars for pods that would take me and my wife to work while we got some work done, take the kids to Karate and Lacrosse, and pick up the groceries, then I would trade in the minivan and commuter car in a heart beat. Just keep a fun car for weekend trips

      #2 It does not have to take a long time. Look at how 4G has spread – we now have 4 credible networks, each of which has cost billions of dollars to build, and only took ~5 years. Companies like Google and Amazon are not afraid to make bets like this where the business case is solid.

      #3 If the dollar is cheap, that actually incents investment from abroad, which is the opposite of what you post.

    • 0 avatar

      Not, I’m guessing, the guy who drives his government-rescued car to his government-backed job.

  • avatar

    Henry Ford felt you should be able to afford what you build so he paid his workers well and kept the price of his cars low. Today’s Ford and other cars company’s are pushing wages down while they push prices up. For a lot of people post “The Crash” car ownership isn’t financially prudent. The problem for the manufacturers is that if 10 people buy cars that are driven 2 hours a day they sell 10 cars but if it becomes cheaper to use Uber et al they only sell 1 car and it’s driven 20 hours a day.

  • avatar

    Seems like a challenging future for a pickup truck company, although they are almost w/o peer when it comes to fleet sales.

  • avatar

    Only 13 comments and I’m speechless…. well metaphorically I am.

    How does one try to use intelligence to answer the unintelligible?

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