Ford fixes its own problems

For Ford Motor Co., the past year really has been the best of times and the worst of times.

Like the rest of the auto industry, Ford sales plummeted worldwide. But the Dearborn automaker also scored major points with American consumers by foregoing a federal bailout and avoiding bankruptcy.

That good will, together with a strong lineup of new cars and trucks, meant Ford fell neither as far nor as fast as the rest of the industry. The company was finally able to pull out of a market share nosedive that began in the mid-1990s. In fact, it gained market share here and abroad while raising the average transaction price of its vehicles.

Influential surveyors including Consumer Reports and J.D. Power and Associates have lauded Ford's quality gains, delivering important endorsements to products such as the Ford Fusion and Fusion Hybrid.

Wall Street has taken notice, too, pushing the price of Ford shares north of $8.50 a year after they bottomed out at just over a buck.

"It's really gratifying to see that everybody is appreciating the Ford plan, plus the progress we are making on the plan," CEO Alan Mulally told The Detroit News.

The question now is can Ford's gains be sustained?

"Absolutely," Mulally said. He recently boosted the company's financial forecast and now expects to be "solidly profitable" by 2011. But Mulally also warned that 2010 will be a challenging year for Ford and the rest of the auto industry.

Sales remain depressed around the world. For Ford and its competitors, that means less revenue at a time when they need to spend more money to meet new fuel economy and emissions regulations.

Ford also faces some unique challenges.

General Motors Co. and Chrysler Group LLC may have damaged their credibility with consumers by filing for Chapter 11, but they also were able to eliminate billions of dollars in debt in bankruptcy court. Moreover, Ford will be more vulnerable in 2011 during the next round of national contract talks with the United Auto Workers after failing to secure the strike protection its crosstown rivals negotiated with the union as part of their government bailouts.

Still, there is no question that Ford has emerged from the turmoil of the past year as the strongest American automaker.

While GM and Chrysler begged for taxpayer aid, Ford, which bet everything on a massive $23 billion financing deal just before the global credit markets seized up, did what America loves best -- pulled itself up by its bootstraps.

That was enough to convince many consumers to visit a Ford showroom.

What they found was a new generation of cars and crossovers that boasted world-class quality and left the automaker's previous ho-hum designs in the dust. Not only was Ford fixing its problems without Washington's help, it was offering cars that rivaled Japan's best.

A year ago, Ford's share of the U.S. light vehicle market was 12.4 percent. Now, it stands at 14.6 percent. More importantly, Ford made those gains without resorting to big incentives. As GM and Chrysler slashed sticker prices and increased rebates, Ford cut back on incentives and raised the price of some of its most popular vehicles. As a result, the company increased its net pricing -- what consumers pay for vehicles, minus any incentives -- by $3.8 billion at the end of September.

"The momentum that we've gained is primarily around the products that we've introduced into the marketplace because, at the end of the day, customers are coming in to buy a product. They're not coming in because a company either did or did not take (taxpayer) money," said Ford Americas President Mark Fields. "At the same time, we've also gotten the benefit of customers saying, 'You know what, we feel good about Ford because you are doing this on your own.'"

Maintaining its momentum will require Ford to keep delivering new and better products, said analyst Aaron Bragman of IHS Global Insight in Troy.

"That's really going to be critical for them going forward," he said. "As we start to see the market rebound, the competition is going to be fierce. But Ford is in a good position because they do have a lot of new product. That's one of the key things that Mulally did -- accelerate the cycle plan."

Next year will see Ford introduce the first in a series of small cars from Europe that are the backbone of its future product strategy. If Ford is to meet its turnaround goals, they need to be an unqualified success.

Jim Farley, Ford's chief marketing officer, is confident they will be. He said the U.S. marketplace changed dramatically over the past year, and so did Ford's place in it. Instead of competing with GM and Chrysler, he said Ford is now competing with Toyota Motor Corp. and Honda Motor Co.

"That's a new place for us in the U.S.," he said. "The good will for the company grew when we decided that we didn't need help. There was a lot more people paying attention to Ford."

But Farley said Ford's work is far from finished -- especially when it comes to consumers' perception of the Blue Oval, which remains colored by years of disappointing products.

"It took a lot of time to get where we are," Farley said. "It's going to take a lot of time to get customers back. But we really have seen tremendous progress."

Ford leads 2010 IIHS Top Safety Pick list with 6, Toyota doesn’t cut it

FoMoCo led all automakers for the second year in a row with six 2010 models that made it onto the IIHS’ Top Safety Pick list, including four vehicles from Volvo, a brand that Ford is selling. For the first time in three years, none of Toyota’s vehicles made the list as tougher criteria cut down the selection from 94 last year to 27 this year.

“With the addition of our new roof strength evaluation, our crash test results now cover all 4 of the most common kinds of crashes,” says Institute president Adrian Lund. “Consumers can use this list to zero in on the vehicles that are on the top rung for safety.”

Subaru is the only automaker with a winner in all 4 vehicle classes in which it competes. Chrysler earns 4 awards, continuing a trend of improving the safety of its vehicles. Two new small cars, the Nissan Cube and Kia Soul also made the list for 2010. GM’s 2010 Buick LaCrosse and Chevrolet Malibu also made the cut.

Ford Van to Go All-Electric in 2010

Ford is driving closer to its goal of producing an all-electric car with the announcement of an electric van for North America for 2010. The Ford Transit Connect BEV will incorporate a drivetrain from Azure Dynamics and lithium ion batteries from Johnson Controls-Saft.

The van will get 80 miles before needing to be charged and will be sold into fleets, according to Ford Manager of corporate news Jennifer Moore. She said Ford will produce the van in low volumes and has not announced any customers so far.

Azure Dynamics, which Ford had worked with before, was brought in to replace Smith Electric Vehicles as the drivetrain partner. Moore said that Smith has decided to focus on medium duty trucks. Today Smith Electric Vehicles announced it was working on a prototype electric postal delivery vehicle with AM General for the US Postal Service.

Ford hasn't committed to Azure Dynamics -- or anyone else -- as a long term partner for it other EVs in development. Moore said Azure Dynamics' extensive experience in building components for electrified vehicles made them an attractive partner.

Johnson-Controls-Saft will be the company's battery partner moving forward. In development are a Ford Focus EV for 2011, as well as an unnamed PHEV vehicle for 2012.

Ford is moving quickly in turning its successful Transit Connect, which only debuted this year, into an EV.

Delivery van fleets that operate on shorter routes are likely applications for EVs and PHEVs since they can be charged centrally overnight and provide sufficient driving range to complete a day's work.

Fewer Vehicles Earn Safety Label With Rollover Test

Nov. 18 (Bloomberg) -- Twenty-seven vehicles earned the top safety rating in a U.S. insurance-industry group's 2010-model crash tests, less than a third of the number a year earlier after a measure of performance in rollover accidents was added.

The top picks did the best job of protecting in front, side and rear collisions, as well as rollover crashes, the Insurance Institute for Highway Safety said in a report today. Ford Motor Co. had the most cars on the list, while Subaru, the auto brand of Japan's Fuji Heavy Industries Ltd., was the only manufacturer with winners in all vehicle classes in which it competes.

Toyota Motor Corp. vehicles were shut out and the number of vehicles on the list fell from a record 94 for the 2009 model year after the institute added a roof-strength gauge to see how the vehicles fared in rollover accidents. The tests now cover the four most common kinds of crashes, the group said.

The picks are "designs that go far beyond minimum federal safety standards," Adrian Lund, president of the Arlington, Virginia-based group, said in a statement. "Now that roof strength is a priority, we think manufacturers will move quickly to bolster roofs to do well in our roof-strength test."

Roofs that meet the institute's standard reduce the rate of serious and fatal injury in single-vehicle rollover crashes by about 50 percent compared with the federal government's minimum requirement, the institute said.

Toyota, the world's largest automaker, had 11 vehicles on the list for its 2009 models, including its Lexus and Scion brands.

Camry Missed Pick

The Toyota City, Japan-based company's Camry missed a top- pick rating because of the rear-end crash evaluation, the institute said. The car's seats and head restraints were rated "marginal" for protection against whiplash injury, the group said.

Ford, the only major U.S. automaker to avoid bankruptcy, had six top-pick vehicles, including four from its Volvo unit. Dearborn, Michigan-based Ford is in talks to sell the Volvo unit. The Taurus and Lincoln MKS, along with the Volvo S80, C30, XC60 and XC90 made the list.

Also selected were Subaru's Forester, Legacy, Outback, Tribeca and some of its Impreza models. Chrysler Group LLC's Dodge Journey, General Motors Co.'s Buick LaCrosse, Daimler AG's Mercedes C class, Honda Motor Co.'s Element, Kia Motors Corp.'s Soul, Nissan Motor Co.'s Cube, and Volkswagen AG's Tiguan and Audi A3 were on the list.

Also among the picks were certain versions of Chrysler's Sebring, Dodge Avenger and Jeep Patriot; GM's Chevrolet Malibu; Honda's Civic; and Volkswagen's Golf, Jetta and Passat.

The institute's "good," "marginal" and "poor" ratings are based on tests of vehicle performance and possible injuries as measured on crash-test dummies in a 40-mile-per-hour frontal impact, 31-mph side impact and 20-mph rear impact, along with the roof-strength test.

Ford to use wheat straw plastic in 2010

Ford Motor announced today that it will use wheat-straw reinforced plastic in its vehicle Ford Flex in 2010. The company is working with plastic compounder A. Schulman of Akron, Ohio, as well as with the University of Waterloo in Ontario, Canada, in the development of wheat straw-based plastics formulation as part of the Ontario BioCar Initiative.

Ford said it is the first automaker to use wheat-straw plastics in vehicles. The company plans to use the bio-based material in Ford Flex's third-row interior storage bins, which, they said will reduce petroleum use by 20,000 pounds/year and will reduce carbon emissions by 30,000 pounds/year.

The wheat straw-reinforced resin is said to be BioCar Initiative's first production-ready application. the bio-resin reportedly demonstrates better dimensional integrity than a non-reinforced plastic and weighs up to 10 percent less than a plastic reinforced with talc or glass.

Other applications being planned for the plastic include center console bins and trays, interior air register, door trim panel components, and armrest liners. Currently, Ford and its suppliers are said to be working with four southern Ontario farmers for the wheat straw supply.

Ford Adds Two Wind Turbines to Power Belgium Plant

Expanding its on-site wind power portfolio sprinkled throughout the UK and Germany, Ford of Europe has added two wind turbines, each with a height of 150 meters, to supply a significant amount of electricity for its Genk plant in Belgium.

Five years ago, Ford’s Dagenham Diesel Centre in the UK became the first automotive plant to meet all its electricity needs from on-site turbines. The automaker says a third turbine will come online next year, following the installation of a new 1.4/1.6-litre Duratorq TDCi engine production line, which will allow the plant to be 100 percent powered by wind.

Ford’s 270-acre Dunton Technical Centre is also powered 100 percent by renewable energy sources, including hydro, wind and waste generation.

Ford also is sourcing renewable electricity from three hydro-power plants to meet the power demands of its sites in Cologne, Germany, including its production facilities at the Niehl Plant, the Technical Centre in Merkenich, and Ford of Europe’s head office.

Ford’s Merkenich Technical Centre is heated by steam provided by local utility provider as a by-product of its co-generation power plant.

The initiatives in Niehl and Merkenich reduce annual CO2 emissions by 190,000 tons, according to Ford.

In Wales, Ford uses solar energy to help power the Bridgend engine plant.

While Ford has primarily focused on wind power to generate electricity at is production facilities, General Motor’s has turned to the sun to power its global facilities.

In the U.S., GM has added a 1.2- megawatt (MW) solar power installation to the roof of its transmission assembly plant in White Marsh, Md., supplying about 20 percent of the plant’s power, and claims two of the largest solar power installations in the U.S. at its Rancho Cucamonga and Fontana, California parts warehouses.

General Motors also claims the world’s largest rooftop solar power installation with 85,000 solar panels at its assembly plant in Figueruelas, Zaragoza, Spain.

Ford Fusion Named Motor Trend Car of the Year

The Ford Fusion is a perfectly competent yet utterly bland vehicle. It’s proof that American firms can compete in the mass-market vanilla sedan segment, but not because it does anything particularly well. Its strength is nothing more than an absence of the glaring issues that kept Detroit out of the Accord/Camry sweepstakes. Which is why Motor Trend doesn’t get overly carried away with the credibility-straining praise of the vehicle itself (with the requisite glaring exceptions, to wit: “the Fusion SE goes from mild-mannered commuter to worthy canyon charger”). So instead, the praise gets spread to the lineup as a whole: “the 2010 Ford Fusion’s impressive bandwidth as a model range was one of the many factors that helped it earn the 2010 Motor Trend Car of the Year award,” we’re told. What this boils down to: you can get a hybrid powertrain in addition to four-pot and six-pot engines. In short, MT gave the Fusion COTY because it does everything a Camry does, but, crucially, it’s from Detroit. Well, Saltillo, Mexico, actually. Still, its advertising budget still comes from Detroit, and that makes all the difference.

McCain says Chrysler unlikely to survive

Arizona Sen. John McCain said Sunday that Chrysler Group LLC is unlikely to survive, despite receiving nearly $15 billion in government loans.

McCain, the 2008 Republican presidential candidate, reiterated his opposition to the $80 billion auto industry bailout begun by President George W. Bush last December.

"No, I don't think we ever should have bailed out Chrysler and General Motors," McCain said in Arizona, where he was serving as grand marshal of at the NASCAR Sprint Cup series race at the Phoenix International Raceway. "We should have let them go into bankruptcy, emerge and become viable corporations again."

Chrysler spokeswoman Shawn Morgan declined to comment on McCain's remarks.

Both GM and Chrysler underwent bankruptcy restructurings this summer, and have since emerged as new companies with healthier balance sheets.

McCain suggested the decision to inject billions into the automakers was because of the political clout of the United Auto Workers union -- and other unions.

"It was all about the unions. The unions didn't want to have their very generous contracts renegotiated so we put $80 billion into both General Motors and Chrysler, and anybody believes that Chrysler is going to survive, I'd like to meet them," McCain said.

Fiat SpA received a 20 percent stake in Chrysler as part of the Auburn Hills automaker's exit from bankruptcy and Fiat's CEO, Sergio Marchionne, is now running Chrysler. The company outlined this month a vision for the next five years.

The UAW insists it made tough sacrifices to save the automakers.

As part of the deal, the UAW agreed at GM and Chrysler to $7 an hour in givebacks in wages and benefits, gave up the right to strike through 2015 and swapped billions in health care payments owed to retirees in exchange for equity in the automakers. The UAW has also seen tens of thousands of members accept buyouts or early retirements.

"We see the automotive industry, and my heart goes out to the citizens of Detroit, really in the tank, and yet we have manufacturing plants all over the South, which are not bound by some of the labor rules and contracts that make them non-competitive," McCain said.

This isn't the first time McCain has criticized the auto bailout, even though he supported aiding automakers during the 2008 campaign for president.

"Chrysler finally filing for bankruptcy! Wish they would have done it months ago as I called for -- could have saved taxpayers $26.7 billion!" he wrote May 1 on his Twitter account.

He also compared the deal to communism and socialism. "President (proposes) government/union takeover of GM and Chrysler -- Lenin would be smiling," he wrote on April 30, referring to the former Soviet leader.

Two days earlier, he wrote: "UAW eventually owning 55% of Chrysler stock and the U.S. Gov owning the rest -- if that isn't socialism, what is?"