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"I am convinced that the objective to build 250,000 hybrids is too narrow to achieve our larger goals of substantially improving fuel economy and CO2 performance." (http://www.detnews.com/apps/pbcs.dll/article?AID=/20060629/AUTO01/606290380/1148)

Bryce G. Hoffman and Deb Price - The Detroit News – June 29, 2006

http://www.cleanmpg.com/photos/data/501/07_Mercury_Mariner_Hybrid.jpg
2007 Mercury Mariner Hybrid, last hybrid for Ford?

Ford Motor Co. Chairman and CEO Bill Ford Jr. is backing away from his much-publicized commitment to produce 250,000 hybrid vehicles a year by the end of the decade, saying the company intends to pursue a broader environmental strategy that focuses more on other alternative-fuel vehicles.

With timing perhaps intended to blunt criticism of the move, Bill Ford announced the strategic shift in an e-mail to employees Wednesday, the same day he and the CEOs of General Motors Corp. and DaimlerChrysler AG's Chrysler Group sent a letter to Congress promising to double their annual production of alternative-fuel vehicles to 2 million by 2010.

Critics decried the back-pedaling on hybrids as another broken promise by the automaker to build more fuel-efficient vehicles.

Bill Ford's hybrid pledge, made last September, was the centerpiece of a national advertising campaign touting the company as an environmental and innovation leader.

"What I didn't foresee at the time was how rapidly other technologies would evolve," Bill Ford wrote in the e-mail, obtained by The Detroit News. "Now, I am convinced that the objective we had set earlier to build capacity for 250,000 hybrids at the end of the decade is too narrow to achieve our larger goals of substantially improving fuel economy and CO2 performance."

Bill Ford said the company will now focus more on other fuels like ethanol, clean diesel and bio-diesel, as well as advanced engine and powertrain technologies.

Later today, Ford will announce a new partnership with VeraSun Energy to create a Midwest "ethanol corridor" with about 50 new E85 fueling stations between Kansas City and Chicago.

"Our strategy going forward is not to wed ourselves to a single technology, but to manage a more flexible approach to meet our goals for customer needs, environmental impact and shareholder interests," Bill Ford said.

Ford is not abandoning hybrids. The company still plans to introduce gas-electric hybrid versions of the Mazda Tribute sport utility vehicle in 2007 and the Ford Fusion and Mercury Milan sedans in 2008.

The company will soon announce that it is opening a new hybrid research-and-development center at its Volvo subsidiary in Sweden that will concentrate on producing hybrids for the European market.

Another broken promise?

The hybrid strategy shift is another example of how Ford is rethinking its business strategy as part of its "way forward" restructuring effort that was launched in January by Mark Fields, the newly appointed head of Ford's Americas group.

Two Ford sources familiar with the situation say there was concern among Ford engineers and others in the company last fall that a public promise to build 250,000 hybrids was going too far and might not be achievable.

Others argued that Bill Ford had to make a strong pledge to kick off Ford's national marketing campaign touting innovation and environmental leadership.

Ford's hybrid chief Mary Ann Wright resigned soon after Bill Ford's pledge to build 250,000 hybrid vehicles a year.

"There were business considerations and there were consumer-focused considerations" for backing away from the hybrid pledge, said Ford spokesman Oscar Suris. "We believe that this plan will make more strategic sense here."

Suris said consumer interest has shifted toward alternative-fuel vehicles in recent months. Environmentalists aren't so sure.

"We definitely think that the demand is there for hybrids," said Mike Hudema, who heads the oil independence initiative at Global Exchange in San Francisco. "We don't see the ethanol infrastructure there."

Hudema said the automaker's decision represents another broken promise from Bill Ford.

Ford "said it would increase the fuel economy of its SUVs. Ford reneged on that. Then he promised to build 250,000 hybrids by 2010. Now we're seeing them renege on that promise. What we haven't seen them renege on is being at the bottom of the barrel when it comes to average fuel economy."

In 2000, Ford promised to raise the fuel economy of its SUV fleet by 25 percent over five years, but abandoned that commitment three years later.

In the 1990s, Ford and the other Detroit automakers promised to develop prototypes for 80-mpg "supercars" by 2000 as part of a deal with the Clinton administration. All three missed that mark and the program was abandoned when George W. Bush took office in 2001. The Bush administration shifted the focus to hydrogen-powered fuel cells, but many experts believe it could be decades before hydrogen vehicles are produced in large numbers.

Hudema and other environmentalists are also concerned that current methods of producing ethanol offset emissions and fuel economy gains of ethanol-powered vehicles.

In their letter to Congress Wednesday, Bill Ford, GM CEO Rick Wagoner and Chrysler Group President and CEO Tom LaSorda, said their companies are doing their part to reduce America's dependence on oil and urged fuel companies to boost production of ethanol and other biofuels and install more pumps. Today, the nation's 170,000 gas stations have 700 E85 pumps, making it difficult for owners of the 5 million flexible-fuel vehicles on the road to fill up with anything but gasoline.

The letter was sent a day before lawmakers go back to their districts for the July Fourth recess, when gas prices will be among the top priorities of their constituents. Environmentalists are pushing lawmakers to boost fuel-economy standards to reduce gas use.

U.S. Rep. Pete Hoekstra, R-Holland, praised the automakers and said the step will be warmly received by Congress. He added that Congress may need to give more tax incentives for stations to add E85 pumps, but predicted that the greater number of flex-fuel vehicles will drive down the cost of alternative fuels and therefore increase demand for more pumps.

"It's a great step by the automakers," Hoekstra said.

No one wants the blame

Spokespeople for the oil industry and environmentalists were cool to the letter.

"The oil industry doesn't own the stations," said John Felmy, chief economist at the American Petroleum Institute, the oil industry's trade group. "What they are calling for is to shift the cost to thousands of independent businessmen who could invest in the pumps and never sell enough to warrant it.

"If the auto industry believes so heavily in the E85 pumps, why don't they put the pumps in at their car dealers?"

Dan Becker, director of the Sierra Club's global warming program, accused the automakers of trying to sell more flex-fuel cars simply to get a credit of 1.2 miles per gallon on their federal Corporate Average Fuel Economy (CAFE) standards so they can sell more "gas guzzling" SUVs and light trucks.

"They're trying to say they are doing something besides making gas guzzlers," Becker said. "The only reason they make E85 vehicles is to weaken CAFE standards."

The automakers' step followed meetings with congressional leaders last month on how alternative fuels can help reduce U.S. dependence on foreign oil.

"Vehicles alone will not get the job done," the CEOs wrote.

"To capitalize on this commitment, Congress and the administration need to continue to promote the production of biofuels, increase incentives for refueling infrastructure and continue incentives for automakers to produce biofuel vehicles.

"Eventually, we need to get to the point where most Americans have reasonable access to these fuels at a price that is competitive with gasoline."

Hi All:

___This is one of the most important and discouraging news items I may have run across yet while at CleanMPG? By emphasizing FFV’s (much lower FE and no break in Ethanol pricing for the foreseeable future), Ford may have signed its own death warrant? They have a top notch diesel emissions program yet have nothing on the street anywhere near meeting Tier II/Bin5 here in the states. The FFV program is basically a marketing farce given our ability to supply Ethanol from corn in quantities to give the consumer his or her expected $1.50 a gallon price ever again :( Cellulosic Ethanol production to date brings about Ethanol pricing right back into the $3.00 + range and you most certainly are not buying an 18 mpg vehicle that receives 14 on Ethanol when Ethanol itself is running at $3.00 + per.

___I wish Ford the best of luck but it now appears my hopes will be riding more with GM’s DualMode? GM knows how to squeeze FE from their non-hybrid counterparts in a number of manners (tall gearing, relatively efficient ICE’s, DoD, Atkinson intakes) but they are so darn far behind where Toyota and Honda are today and will be in another few years I am not sure they will ever catch up?

___I could understand GM pulling back on their Fuel Cel promises because that will not bare a dime of profit for tens of years if ever but Ford to de-emphasize hybrid technology and production? Unless they are having problems with taking the FF to TCH like FE performance (this could be the crux of the announcement?), this is a very sad day for the American automobile industry :(

___Good Luck

___Wayne

This smells so much like a spin job - saying "we are moving forward even faster" when it's really a U-turn. :mad: Are hybrids hurting Toyota's bottom line? What happens if the Supreme Court says individual states can regulate CO2 emissions?

It's one thing if Mr. Ford gives an extention to agrueably the worst NFL General Manager in football for the hapless Detroit Lions, but similar decision to the family business is a lot more than a ballgame. :(

This may be related > http://www.msnbc.msn.com/id/13609125/

Ford is dismisses bankrupacy plans, but acknowledges recovery will be harder than forecast.

If Ford feels like hybrids are too expensive a long-range plan, they are in dire straits....

...

"The oil industry doesn't own the stations," said John Felmy, chief economist at the American Petroleum Institute, the oil industry's trade group..."If the auto industry believes so heavily in the E85 pumps, why don't they put the pumps in at their car dealers?"...



Why not, indeed? This question really caught my eye.

DAS

Insanity. They have some of the best hybrid technology in current production, competitive (if not virtually identical) to HSD. All they have to do is put it in a range of vehicles, say, a compact in addition to the mid-size Fusion, and they're in the game against the Japanese brands. Now, I fully agree that they shouldn't do just that, as hybrids are only something like 1% of today's market. But how hard can it be to coax a marketable improvement in FE out of a conventional vehicle? I've walked through their laboratories, and I've seen the resources with my own eyes. Just get a few V8s out of those test cells and work on some better I-4 powerplants!

Ford is already working on a FFV Escape Hybrid. This article sounds to me like the big three needs some help from the Gov to back off on adopting tougher standards on MPG. The public is putting pressure on law makers because of the price of fuel. I think the higher cost and lower profit margins of hybrids is forcing American automakers to look at FFV to stay in business now.

After all, the cheaper FFV can still run on straight gas, and most likely get better FE than E85. It looks like the price of gas is going to continue to rise, but E85 will be offered at a lower cost with less FE. To me, this is all bait and switch where big business gets the gold mine, and the public gets the drive shaft. Did you notice the comment about Ford's Volvo Subsidiary in Swedan will concentrate on hybrids for the European market. The price of hybrids are going up folks.

The FFV hybrid and all other hybrids will still be made, but at a higher price. It’s all about money till the earth is nothing but a big dump site for our kids to play on.

GaryG

Someone over at GH hit on the real reason Ford is going this way (if it is indeed true). I'll find it and be back in a flash....That doesn't surprise me that Detroit would think "cheap" instead of "smart". They're also abusing a loophole in the CAFE standards that basically only count the 15% gasoline in E85 -- even though these vehicles will be running on 90-95% gasoline for the foreseable future. This loophole lets Detroit build gas guzzlers that are then categorized as "efficient".

Let me predict that the average car buyer isn't going to be impressed with the little green leaf on the side of a monster-SUV that gets 7 MPG on E85.

Thanks, but no thanks. Even on a positively lousy week, my HCH manages to get 36 MPG.

Is that a bunch of horse excrement or what?!

Insanity. They have some of the best hybrid technology in current production, competitive (if not virtually identical) to HSD. All they have to do is put it in a range of vehicles, say, a compact in addition to the mid-size Fusion, and they're in the game against the Japanese brands.
I'm confused too. The Escape Hybrid drivetrain should have been a drop-in solution for the Fusion with little to no modifications needed. Instant Prius/Camry Hybrid fighter with 40+ mpg likely due to the smaller frontal area and total vehicle drag than the Escape.

I'm confused too. The Escape Hybrid drivetrain should have been a drop-in solution for the Fusion with little to no modifications needed. Instant Prius/Camry Hybrid fighter with 40+ mpg likely due to the smaller frontal area and total vehicle drag than the Escape.

- the Fusion is coming out next model year (08). its powertrain is done and locked in- the guys at the FEH openhouse last fall saw one driving around, IIRC?

- even so, there is not such thing as a 'drop in' anything in realworld engineering, and especially not going from an SUV to sedan. Space under the hood alone is different enough to present challenges. The same reason the HAH is a V6 and not the I4...the I4 with IMA could not 'drop in' under the hood. Please NEVER dismiss the effort requried to 'drop in' something into another platform. It takes a lot of work to get it right, and Ford has to get it at least as right with the Fusion as they did with the FEH.

In the bigger picture, one model year difference (now for TCH, next year for FFH) is not going to make or break anyone.

Toyo has the PR lead for 'green' (despite massively increasing sales of V8s that make the Prius sales look like a drop in the bucket, and opening new factories with viutually no eye towards reduced footprint). Nobody can realistically steal that from them anytime soon- not even worth trying to, really.

I agree that the FFV-CAFE loophole is a copout, but in the end we still win. All the candidate technologies will evolve more or less in lockstep- in 5-8 years it will be as hard to find a normal gas-only car as it is to find a 5-speed stick today. I am taking the view that this announcement is more of a hedge that FFVs will be at least as important to Ford as hybrids, and they are acknowledging that hybrids alone have been a little overhyped (brace for flamethrowers). The technology will remain, and become more and more mainstreamed, but as a standout feature it will be less and less important.

I'lll be open-minded and not get offended about the hybrid being overated. I'll even agree it's not a silver bullet. In the big picture, who is making fuel-efficient vehicles? You get basically the same answers - Toyota, Honda, Volkwagen diesels....Detroit makes most of the gas guzzlers.

Making a big FFV seems nearly as green as a hybrid Escalade.

From what we are seeing, the supply will not be able to meet the demand for ethanol. The cost will continue to escalate at the pump for all types of fuel. We've already seen what a quick rise in demand for ethanol has done to the price per gallon. Can production of ethanol then keep up with the rising number of vehicles engineered to run on it? How long can such a plan succeed until more and more cropland is turned over to the production of fuel? As long as people continue to go to a fuel station to pump multiple gallons into their vehicles, regardless of the mix of gasoline/ethanol, the status quo of poor fuel efficiency will remain and will ultimately be unsustainable. Fuel efficiency is the ultimate answer.

I'lll be open-minded and not get offended about the hybrid being overated. I'll even agree it's not a silver bullet. In the big picture, who is making fuel-efficient vehicles? You get basically the same answers - Toyota, Honda, Volkwagen diesels....Detroit makes most of the gas guzzlers.

Making a big FFV seems nearly as green as a hybrid Escalade.

thanks. What I meant in detail, I suppose, was that the perception of hybrids as "the" solution is ovehyped. The technology is not, and it will simply be assimilated into almost every regular vehicle in the not-distant future.

In the end, the solution, as we've all agreed to many times before, will be a heterogeneous mix of all the candidates. IMO Ford is simply stating that bluntly- there's no point in putting only one type of egg in the basket, because the ultimate answer requries there to be a variety of eggs. Given limited resources, they have to back off from letting hybrid dominate their strategic planning, and shift some of those resources to hatch the 'other eggs.'

That's my take. I am very optimistic by nature, too. The market will determine if they get it right.

- even so, there is not such thing as a 'drop in' anything in realworld engineering, and especially not going from an SUV to sedan. Space under the hood alone is different enough to present challenges. The same reason the HAH is a V6 and not the I4...the I4 with IMA could not 'drop in' under the hood. Please NEVER dismiss the effort requried to 'drop in' something into another platform. It takes a lot of work to get it right, and Ford has to get it at least as right with the Fusion as they did with the FEH.
Have you ever seen under the hood of the 5.4 liter Cobra R from a few years ago? Seriously, that was an engine never designed to fit in anything smaller than the Navigator and they somehow squeezed it in the confines of a Mustang's engine bay. I'm convinced that if Ford can pull that off, fiting a little 4-cylinder engine and electric motor in the engine bay of a midsize sedan is cake.

http://www.fastcoolcars.com/images/2000_cobra_r/2000-cobra-r9.jpg