Ford hopes rest on new models.

Discussion in 'Ford' started by xcel, Sep 18, 2006.

  1. xcel

    xcel PZEV, there's nothing like it :) Staff Member

    Bringing crossovers, gas misers to market quickly is key to rebound.

    Christine Tierney - Detroit News - Sept. 16, 2006

    Ford will update the Ford 500, Freestyle, Escape and Focus, and the Mercury Montego and Mariner.

    In an effort to brake its slide in the cutthroat U.S. market, Ford Motor Co. plans to step up the pace of new vehicle introductions and roll out more fuel-efficient cars and popular crossovers.

    "This remains a product-led turnaround first and foremost," Mark Fields, head of Ford's Americas division, said Friday at a conference to announce an accelerated restructuring.

    The Dearborn automaker is losing money after suffering a steep decline in its U.S. market share in recent years. Fields predicted it would fall further, to about 14-15 percent from just under 17 percent now.

    While analysts welcomed Fields' candid assessment, many questioned whether Ford had sufficiently stocked its pipeline.

    It plans to bring out additional models and executives expect close to 70 percent of Ford, Mercury and Lincoln cars and trucks to be new or substantially updated by the end of 2008.

    "That compares with 59 percent in our prior plan," Derrick Kuzak, group vice president in charge of product development for the Americas, told The Detroit News.

    He said Ford was renewing existing model lines faster, too. While it produced the previous generation of F-Series trucks for seven years, it will redesign the current model in 2008 - barely five years since its introduction.

    "We've redefined our cadences, recognizing the need to bring product to the market faster," Kuzak said. "What you're seeing is that revised cadence."

    Earlier this year, Ford halted development on the truck for two months to add features after dealers said the vehicle needed to be more competitive. "The results are substantial," Fields said, "including a full redesign of the product from front to back and an even stronger powertrain lineup."

    Ford will add five new vehicles to its lineup. "Several of those will be white-space products" that defy traditional categories, Kuzak said.

    Still, many analysts said Ford's plan did not go far enough. The U.S. automakers are losing ground to Asian carmakers, which are putting out models at a faster clip.

    Ford's plan "does not materially accelerate product introductions," Merrill Lynch analyst John Murphy wrote in a report.

    Most of the new models cited Friday were known to be in the pipeline - and some are coming out very late, analysts said.

    With its plan to roll out a large crossover in 2008 based on the Fairlane concept, Ford lags General Motors Corp. by nearly two years, said Rebecca Lindland at forecasting firm Global Insight.

    "The places they're talking about coming out with new product are incredibly competitive, like small cars," she said.

    GM, Toyota Motor Corp. and Honda Motor Co. have already launched attractive subcompacts. "Ford is going to be very late to the buffet."

    Since 1998 its share of the market has fallen eight percentage points - including a full point in the past year as consumers shifted from traditional SUVs such as the Explorer to cars and crossovers.

    Ford's new midsize sedans, such as the Ford Fusion and Mercury Milan, benefited from higher demand for fuel-efficient vehicles. "We've got the right products in some areas," said Peter Horbury, Ford's designer for the Americas. "The Edge is right on time," he said, referring to a crossover due out in the fall.

    But Ford's truck-based SUVs and F-Series trucks have suffered. Rivals GM and Toyota will roll out new full-size pickups in coming months, heightening the competition in the segment that Fields called "our bread and butter."

    Erich Merkle, director of automotive forecasting at IRN Inc. in Grand Rapids, said Ford's rivals are all targeting the F-Series. "It's going to take everything Ford can muster to defend their position."

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