Chrysler and GM have spent the last month chasing each other around the drain. For those of us who closely follow the auto industry, it’s resembled some sort of twisted financial Nascar race in which both are doomed to crash. Then there’s Ford, smugly sitting out the Bankruptcy Shootout, by virtue of having mortgaged everything before the financial meltdown.
There’s a way of thinking that bad news for Chrysler and GM is good news for their crosstown rival, ostensibly because the “Buy American” types might be predicted to become Ford customers if it indeed becomes the last man standing. While this may be true, it seems somewhat beside the point, as Ford is only in good shape if you’re so myopic that you only compare it to a pair of failing carmakers. Despite its stock climbing above $5 for the first time in six months, Ford’s cash burn is still being measured in the billions. Any reasonable assessment of Ford can only conclude that its problems are still massive. Here are the five largest ones:
There are still too many people in Dearborn who see the auto industry through the prism of the 1960s. In fact, there are just generally too many people in Detroit who are too deep in the auto industry to be able to see the forest for the trees.
1. Lincoln-Mercury. Ford’s “luxury” marque is a disaster. Lincoln once produced the sort of formal luxury car fit for leaders of state, and now it’s hard-pressed to build a car worthy of middle managers. The value proposition of Lincoln’s warmed-over Ford siblings is poor enough to ensure that any cubicle slave who buys one is probably not the sort worthy of promotion. Mercury, on the other hard, has never been much of a brand but at least it used to have a purpose when there was more space between the Ford and Lincoln brands. Today Mercury might as well go the way of Oldsmobile and Plymouth. Speaking of brands that need to go away, there’s...
2. Volvo. Ford never had any business owning this insignificant brand to begin with, and apparently the powers that be at Ford have realized such, as the Swedish subsidiary is currently for sale. We’ll have to wait and see how much money Ford loses on the deal, and whether spending most of this decade integrating its passenger-car platforms with Volvo’s was worth the money. Probably not. You don’t see successful car companies like Honda and Toyota buying smaller carmakers to get at their engineering and product expertise. Which also begs the question, why does Ford so often rely on partners like...
3. Eddie Bauer, Harley Davidson, Microsoft, et al. Is there some sort of lack of self-esteem in Dearborn that causes FoMoCo to enter into these co-branding agreements? Am I the only one who sees these moves as having questionable merit? The Ford brand is one of the most instantly recognizable corporate logos in the world, and I’d think Job One would be strengthening it from within. Worse even than the product-branding deals that irk me so, are some of Ford’s insipid sponsorships, like American Idol. In our niche-media world, even big car companies should be thinking small, and more importantly, relevant. Ford should focus on marketing the hell out of its strengths, like...
4. The Mustang. Arguably the best car Ford builds, it’s also the most cherished. It’s one of the few things Ford has done right this decade. But it also represents the Achilles heel of a company that loves to look backward more than it does forward. Ford’s retro product diversions seem, thankfully, to be mostly over, killed by the unsuccessful Thunderbird, but there are still too many people in Dearborn who see the auto industry through the prism of the 1960s. In fact, there are just generally too many people in Detroit who are too deep in the auto industry to be able to see the forest for the trees. Maybe that’s why Ford is strill struggling with...
5. Ford 2000. Note that with the release of the first 2010 model year vehicles we’re a full decade past the point in which Ford had planned to be a lean, global organization. But the holy grail of the “world car” is still out there, and Ford’s North American product portfolio still has nothing in common with the vehicles it sells in Europe, let alone other markets. As Ford shrinks here in the U.S., it will only become more imperative that it finally get this right and can unify both its product development and manufacturing operations to become what is truly a single company. If it can’t succeed at this, it won’t be able to succeed in the new automotive era, period.
