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Automotive Industry

Ford: Big, Bigger, Biggest - Ford will be the world's leading automaker - Brief Article

Automotive Industries, July, 2000 by Ken Gross

Jac Nasser won't say this publicly, but Ford Motor Co. will be, one day in the not-too-distant future, the world's largest car company. I'm convinced of it.

The exact timing is anyone's guess. But the strategic moves made by Nasser and Bill Ford to expand their company's brand umbrella, define the products underneath it. and develop those products, will enable Henry Ford's enterprise to surpass General Motors sometime after the company celebrates its centennial in 2003.

Don't believe me? Consider the following.

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Ford is better positioned than GM to be where the entire market is headed. There's expandable low-end volume under the Ford nameplate, plus affordable models from Mazda, Mercury and now, perhaps, Daewoo. GMs units are concentrated in the low and midrange, with too many dealers and undistinguished products.

GM, it seems, can't build a high volume, low-priced car that's as good as the Focus -- which just cracked the top 10 sales list in North America. What's more, the company that gave the world the marvelous small-block V-8 will be putting Honda V-6s in its upcoming Saturns. That'll be an interesting branding spin for Ron Zarella: Powered by Honda.

Mid-range, GMs remaining brands are jumbled. Confusion still reigns over just what is an Oldsmobile and a Buick, and how much of the product in those brands differs from the other. Thank goodness for tracks.

But it's in the upper crust of the market where Ford's Premier Auto Group (PAG) most clearly delineates the Ford-GM difference. Arguably, it starts with leadership. According to a top-ranked insider, ex-BMW productmeister Wolfgang Reitzle was interested in a possible GM opportunity. But I'm told that Jack

Smith would never have reorganized his company to snare Reitzle the way Jac Nasser quickly did. The PAG may be London-based, but its peripatetic chairman whirls weekly from HQ to HQ, dispensing orders and ensuring a steady flow (so far) of great products.

While Cadillac struggles to preserve its share of an increasingly competitive upper segment. Ford's Premier Group adds midrange units with Volvo, a future Land Rover Freelander and Jaguar's compact X-400. For the growing ranks of well-to- do customers, there's more to come from Lincoln, Volvo, Jaguar, Land Rover and Aston If Bugatti or Rolls ever get serious, Ford could even dust off Lagonda.

The biggest difference between GM and Ford is this: Ford knows what's worth buying. Even better, it understands how to manage and nurture its newly acquired brands, while respecting yet capitalizing on each one's uniqueness. Look at the difference of what's happened so far. Ford purchased Jaguar and Aston Martin; GM bought Saab and Lotus. A resurrected Jaguar's on its way to a BMW-like volume of a half-million cars annually. The next Aston, which I was shown in Britain last month, will put a scare in Ferrari. At Land Rover, new director Bob Dover is an industry veteran who knows what's wrong in Solihull. Employing Ford's resources, he'll fix the great 4x4 maker without losing the brand's cachet -- or making the mistakes BMW did.

Perhaps a Volvo engineer whom I met recently summed it up best. He assured me that his compny is benefiting from Ford, but added, "We'll still be drinking aquavit in Gothenburg for a long time."

GM hasn't done nearly as well. Saab remains stuck in a narrowly focused range without the volume potential that Ford-owned Volvo has. And Lotus, a skunkworks of clever engineering, was sold. GM couldn't understand or manage it.

GM continues to prove that it lacks the ability to significantly grow its many overlapping brands. And it's been too timid in acquisitions and partnerships. Because of this, the company's U.S. market share could easily slip below 25 percent.

It's not too late for GM to fix what's ailing it. but the clock is definitely ticking. And time and momentum are, in my opinion, on Ford's side.

KEN GROSS is director of the Petersen Auto Museum in Los Angeles. A former brand manager of a global consumer goods company, Ken has written extensively about automobiles for three decades.

Automotive Industry

Ford: Big, Bigger, Biggest - Ford will be the world's leading automaker - Brief Article

Automotive Industries, July, 2000 by Ken Gross

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