Happy Birthday, Ford.
Maybe not so happy.
June 2003

On 16 June, Ford celebrated its 100th Anniversary. More than 100,000 people attended a big party held in its Headquarters in Detroit. A total of 100 historic models, one car each year, from the first Model A of 1903 to the latest Ford GT of 2003 were displayed there. Dancing and singing, wine and beer filled all over the party, eclipsing the worrying sales figures and pessimistic future lying ahead. Yes, Ford Motor Company is declining.

First of all, its status as the world’s second-largest car maker will be substituted by Toyota in 2004. Last year, Ford’s production dropped by 0.5% to 6.97 million units while Toyota jumped by 7.9% to 6.31 million units. This year, its American market share will continue to slide as a result of the Japanese attack as well as the aggressive discount by GM. More worrying is that the high-profit heavy truck market, which used to be dominated by the Big Three, is now being eaten by Japanese car makers. For example, Toyota and Nissan are introducing V8-powered trucks for the first time in the USA. As Ford is the current sales leader in both the SUV segment (Explorer) and the truck segment (F-series), it will also suffer the most.

While the truck line-up is under serious threat, the car line-up is aging to the extent that only fleet buyers are interested. The Taurus was never a brilliant car at launch and it has passed its golden age long ago. But unfortunately, Ford ignored the call for a replacement for years and only last year it greenlighted the development of a replacement, the Ford 500. That means poor Taurus has to soldier on for at least 2 more years. 

Ford’s strategy in the US market can be described as a mess. How can it allow the wide gap between Focus and Taurus not filled by a medium-size car? how can it create Marauder base on the ancient Crown Victoria? you may say because it concentrated most resources to the growing truck and SUV market. But is it wise to give up the car market then? what will it be when the Japanese dominated the car market and start invading the truck market? when you explore a new continent, you won’t give up your homeland.

Bill Ford Junior seemed fascinating about the idea of "Living Legend", believing it could revive the reputation of Ford. What is the result? the love affair of Thunderbird cooled down as quick as it heated up and it will be sent to grave soon. The new GT seems to attract a lot of attention from car journalists, but can it boost sales to Ford’s showrooms which are full of outdated vehicles? I can’t see how a car lover go to showroom to see the GT and end up buying a Taurus. Only good cars will sell.

Lincoln is another failure Ford would rather forget. A few years ago Ford decided to revive the Lincoln brand. It hunted Gerry McGovern from Rover to head the Lincoln design studio, created several concept cars which are to shape the future production model. Now where is the production model? we no longer hear anything about that from Ford. We only saw McGovern moved back to Europe and is no longer responsible for the future of Lincoln. I suspect, Ford has scrapped the plan for reviving Lincoln.

Ford’s overseas divisions give us mixed impression too. Mazda’s hope - the Mazda 6 sedan - sold badly in its biggest market, the USA. Jaguar is even operating at a loss, blame to the poor reception of X-Type. Ford of Europe is still in black, but its short-sighted vision is leading to the lost of market share to the more innovative PSA and Japanese rivals. Luckily, Volvo and Land Rover continues to contribute to profit, if slim profit.

So, the 100-year-old Ford Motor Company looks really old and tired. No wonder GM takes this chance to launch a price war.

Mark Wan

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