2010 Detroit: Fords leaders speak

I attended a dinner on the night of the first media preview day of the 2010 Detroit Auto Show with Ford Motor Company CEO Alan Mulally and two of his top executives, CFO Lewis Booth and recently appointed head of Asia/Pacific & Africa operations Joe Hinrichs. As has become custom with Mr. Mulally during his dinnertime discussions with the automotive and business media, the dinner was held in a roundtable style where each journalist asks a question in the order they are seated at the table, and the Q&A repartee goes round and round and round again. Here are some of the highlights:

Alan Mulally: “Everybody at Ford really knows now that they are competing with the best companies in the world.” The implication was, he’s trying to make Ford one of the best companies in the world, not just one of the best automakers.

On Ford’s product mix and its upcoming, no-holds-barred dive into the small-car segment:

AM: “When you walk into a Ford store, you’re going to be able to get the vehicle size you want, from F-150 on down, and every one of them is going to be best in class. We chose to have a balanced portfolio. [When I joined Ford], I had to ask, ‘why did our kids on the west and east coasts grow up only in Hondas and Toyotas?’ Because Ford didn’t make [compelling] small or medium cars.”

On any potential plans for an SVT (Special Vehicles Team) Ford Focus and/or Ford Fiesta:

Lewis Booth: “No comment.”

AM: “No comment, but, clearly…..” [long pause; the implication was definitely that this is in the works; I would guess the Focus is more likely than the Fiesta, especially since Ford still has residual goodwill for the short-lived but highly regarded SVT Focus from earlier in 2000s.]

On the battle for market share:

AM: “There is nothing worse than overcapacity in the industry, and this industry still has it worldwide. We [Ford] are not going to chase market share.” This has been a central theme for Mulally during his time at Ford: to adjust Ford’s production to market demand, rather than building a set number of cars because of plant and worker overcapacity, then trying to force those cars at discounts onto the market, which was a huge part of GM’s downfall. Naturally, this sort of “right-sizing” doesn’t come without pain; Ford has had to close many plants over the past few years.

LB: “We now have competitive products, so we expect to achieve competitive prices [in the marketplace, versus the days when Ford had to use too many incentives to move cars out of dealerships].

On Ford’s ability to avoid bankruptcy, which its crosstown competitors GM and Chrysler both endured in 2009:

AM: “At the most fundamental level, we are very pleased that we are operating our business outside of bankruptcy. Now, we do have debt. But the advantages [of not being in bankruptcy] far outweigh the disadvantages.”

To the question, do GM and Chrysler enjoy an advantage over Ford in terms of per-vehicle cost, now that most of their debt has been wiped clean, whereas Ford is still saddled with some $20+ billion in debt?

AM: “They have NO advantage. None. Absolutely none.”

To the question, Why doesn’t Ford kill Mercury [which is clearly a sore subject for Mulally]:

AM: “Ford, Lincoln, and Mercury are the core. We have a great network of Lincoln-Mercury dealers, and Mercury has a great following. We are positioning the Mercury brand as a bit more luxury than Ford, but not as much as Lincoln, which we’re moving upmarket. What Lincoln is not, is a rebadged Ford. We absolutely differentiate [Lincoln and Ford]. Lincoln’s DNA [is similar to] BMW & Lexus.”

To the follow-up question, wherein Mulally was pressed on the comparison between Lincoln and BMW and Lexus and asked which of those two competing brands Lincoln is really chasing, Mulally quickly replied,

“Lexus.”

Not a surprise, that, since it was widely reported when Mulally joined Ford back in 2006 that he drove a Lexus until he arrived in Dearborn.

To the question, What will Ford miss about Volvo? [which will soon be in the hands of Geely, the Chinese automaker]

AM: “A great brand, and GREAT people. We wish them the best.”

To the question, Have you [Mulally] been asked to be CEO of GM?

AM: [long pause]. “No. I love Ford.”

But with the tone of his response, and the way in which he delivered it, one can easily imagine that, actually, he was indeed approached to take the reins at GM. Mulally elaborates, though:

“I’ve fallen in love with Ford. I left Boeing after 38 years for the chance to turn around another American global icon. To get a chance to serve two global icons, in one career….” [Then he gets a dreamy look on his face.]

On the next-generation Fusion and the next-generation Mondeo, the Fusion’s Euro-market counterpart:

LB: “They will definitely share platforms.”

AM: “Wait until [we launch] this car. It is the finest vehicle I’ve ever seen.”

We’ll take your word on that, Alan….

To the question, Have you [Mulally] been asked to be CEO of GM?

To the question, Have you [Mulally] been asked to be CEO of GM?

To the question, Have you [Mulally] been asked to be CEO of GM?

To the question, Have you [Mulally] been asked to be CEO of GM?

To the question, Have you [Mulally] been asked to be CEO of GM?

To the question, Have you [Mulally] been asked to be CEO of GM?

To the question, Have you [Mulally] been asked to be CEO of GM?

thesavagepony
If Mulally were to ever leave Ford to go to GM I think the backlash might be a little too great for him. Ford fanatics would probably riot like no other...at least I think that's what would happen. Glad to see the that Ford is pushing forward and know what mistakes not to make unlike GM and Chrylser...which, just like the article stated, led them to bankruptcy.

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