Ford's comeback effort still sputtering
DEARBORN -- Ford Motor Co. received more bad marks on its latest internal
report card, but Ford Americas President Mark Fields told employees
Wednesday that he is still confident the company will achieve its turnaround
goals for the year.
Ford distributed the report card to employees following Fields' weekly
Webcast. The document, a copy of which was obtained by The Detroit News,
shows Ford's February retail sales in the United States were worse than the
company projected they would be just one month ago.
Ford's recovery plan called for the company to hold onto just more than 10
percent of the domestic retail market in February. Last month, it said that
was unlikely, but projected it could hold the line at 10 percent. However,
Ford only managed to claim a 9.8 percent share for the month, missing that
mark by about 1,900 vehicles.
After losing $12.7 billion last year, Ford has mortgaged its U.S. assets to
fund a sweeping turnaround plan. Halting its long retail market share slide
is critical to the success of the stategy.
Ford blamed the miss on weaker than expected sales of the Ford Explorer
sport utility vehicle, Ford Mustang sports car and the company's
bread-and-butter F-series pickup. But executives are confident that Ford's
new advertising campaign, which challenges consumers to compare Ford
products to offerings from rival manufacturers, will help get sales back on
Ford's recovery plan calls for the automaker to hold between 10.5 and 11
percent of the domestic retail market by the end of the year.
Fields reviewed the March report card during the Webcast. He stressed that
the company's full-year goals have not changed, and expressed confidence in
Ford's ability to meet them -- despite the setbacks in January and February.
Ford spokesman Oscar Suris said the numbers presented to employees only show
part of the picture.
"This is not a comprehensive look at everything affecting the business,"
Suris said in an interview.
"There are other areas where we are ahead of schedule. Overall, we are where
we expected to be at this point."
The report card also looked at Ford's progress on cost-cutting.
It showed the automaker made some progress, exceeding last month's forecast
by 9 percent, but still falling short of the targets in its restructuring
According to the document, financial weakness at many of Ford's suppliers
continues to be a challenge.
Ford executives praised employees for their cost-cutting suggestions and
encouraged them to continue to think of ways to save the company money.
For example, workers at Ford's Kentucky Truck Plant in Louisville have made
over 200 suggestions on ways to save money on the new Super Duty pickups
that could trim hundreds of dollars from the manufacturing cost of the
vehicles. Ford is studying those ideas now to make sure they will not affect
quality and expects to implement many of them.
This month's report card also looked at another metric that Ford calls its
"brand favorability rating" -- the percentage of car buyers that have a
positive view of the Blue Oval. According to the document, 39 percent of
those surveyed said they had an "excellent" view of Ford.
"That's better than our domestic competitors," Suris said, though he said
the company still has a ways to go before catching up with Japanese brands
like Toyota. "We don't want to stay there."
During his Webcast, Fields said improving brand favorability is a key
objective of Ford's recovery plan.
Doing that will require more victories like the one Ford recently scored in
Consumer Reports magazine, which recently named the Ford Fusion one of the
best new cars on the road and put a photo of the sedan on the cover of its
annual auto issue.
Fields also challenged employees to talk up the company's new products with
everyone they know, saying word-of-mouth marketing can help change the way
people look at Ford.
The credit belongs to the man who is actually in the arena; whose face is
marred by dust and sweat and blood; who strives valiantly; who errs and
comes short again and again; who knows the great enthusiasms, the great
devotions and spends himself in a worthy cause. Who at the best, knows the
triumph of high achievement; and who, at the worst, if he fails, at least
fails while daring greatly.
T.R. April 10, 1899