Ford has signalled a shift in their strategy away from standard cars towards trucks, SUVs and EVs. It’s all part of a restructuring plan by the company to save money and prioritize what it thinks it the way forward in motoring.
The new boss of Ford Jim Hackett has completed his 100 day review and presented his five year strategy last week. It is designed to streamline the company and spend more on the products consumers want to buy and less on those that don’t make profit.
The production strategy shifts from the cars we seem to be moving away from towards SUVs and crossovers. Trucks and EVs will be getting more emphasis too. Ford is reallocating $7 billion of investment from sedan development to these three key product lines in order to remain competitive. This will inevitably see well-known models cease production but we don’t yet know what models and when.
The investment will seek to speed up the development cycle too, making the automaker much more responsive to changes in the market.
The plan also wants to shift Ford from automaker to ‘mobility company’ which won’t make much difference to most of us. The presentation said Ford wants to be the ‘world’s most trusted mobility company, designing smart vehicles for a smart world that help people move more safely, confidently and freely’. Fine words indeed.
Hackett also committed the company to autonomous vehicles. He reiterated the promise of a fully autonomous vehicle by 2021 with market-ready consumer models ready by 2025.
Cost-cutting is a big part of this strategy. Cost cutting across the board will be introduced including improving materials acquisition, reducing running costs, development costs and manufacturing costs. Some of this will be achieved by utilizing universal parts across many of its models while other ways include fewer prototypes and more development in the more productive product lines.
Finally, Hackett promised more collaboration with other companies and joint ventures to share costs and develop new products.
What does this mean for you and I? Not a lot for now but in five years’ time it could mean fewer Ford sedans, fewer fossil fuelled engines, more EVs, more crossovers and a narrower product portfolio. I suspect most automakers will be doing much the same thing so this isn’t going to be unique to Ford.
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