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« Reuse Design Or Start from Scratch? | Main | The Award Goes to the Most Creative and Inefficient »


May 31, 2007

Is Ford Making A Comeback?

By T. D. Clark

Say what you will about Ford Motor Company — we certainly have — but the reality is that Ford's slash-and-burn strategy is showing albeit-slight signs that it is working. At least, that's what the automaker's top analyst thinks.

Ford has never been a company that "likes to live on the edge," as one of its national TV ad campaigns proclaims. However, the once-mighty automaker is starting to see a slight uptick in sales, thanks in part to its hipper-looking crossover vehicles. Its retail sales to individual buyers could show a year-over-year monthly increase for the first time since October of 2006. Here's how The Associated Press this week spins it:

George Pipas, Ford's top sales analyst, told reporters Tuesday that the increase, which includes only the Ford, Lincoln and Mercury brands, would be fueled largely by rising sales of new crossover vehicles. He said overall sales, which include those made to rental car companies and other fleet buyers, would drop by a single-digit percentage when compared with May of last year.

"'The way things are progressing, it could well be our highest level of retail sales since August of last year," when the company was trying to clear out vehicles at the end of a model year, Pipas said.

Wow. In a nutshell, the AP story says the improved retail sales results are due to "rapidly rising sales of the Ford Edge and Lincoln MKX crossovers, which are vehicles that can do the things a truck-based sport utility vehicle can but are more fuel efficient because they are built on car underpinnings"

(I'd also like to think that Ford's sales are on the rise thanks in part to some well-placed ads and product placements during FOX's "American Idol" show, which regularly draws tens of millions of viewers on a weekly basis. Maybe this type of strategic thinking can prop its sagging image… .)

The other notable aspect to Ford's turnaround lies in its treasure trove of luxury car brands that many industry pundits believe are ripe for the auction block. BusinessWeek does a good job of dissecting these swirling rumors, all of which Ford denies, of course. The latest rumor is that Ford wants to unload Volvo to BMW:

Executives talked to BusinessWeek on and off the record about the reports, insisting that there have been no deal discussions at the top of the company. But a BMW executive speaking not for attribution said it was "certainly possible that BMW had been studying an acquisition of Volvo as a matter of normal business planning when we know a business is potentially for sale."

And according to Ford spokesman Tom Hoyt: "Ford is not in discussions with BMW or any other company regarding Volvo. We have seen this kind of speculation for the past year, as Ford has been assessing our operations and portfolio — as any good business does and we will continue to do."

Either way, does it matter? Ford is sitting on some good brands that it can sell off for a pretty penny should it need another infusion of cash.

Then again, Ford's Premier Auto Group (PAG) — which is made up of Volvo, Jaguar and Land Rover — lost $327 million last year. Regardless of the value/performance of these esteemed brands, a sale of one or more is inevitable. Why? Well, this might be is a stretch, but according to The San Antonio Business Journal, Ford is set to sell its St. Paul hydroelectric plant to Brookfield Power, a Canadian hydroelectric firm.

Hey, if Ford's willing to sell something as leading edge as renewable energy, why not lighten the brand portfolio as well?


Earlier: The Cautious Big 3 and the Asian Auto Market

Embattled Car Brands Try to Bounce Back


Sources

AP

BW

SABJ



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Comment

2 Comments

klaus J Rott said:

By way of the fanggled so called 500 duped the Ford Passat they must realy hate VW, The new immage (Fusion) is still that of the Passat many elements of the new skin still bleeding through though desp several make overs of that "NEW FLAGSHIP" to be?

But then, Ford is not alone in the business of semi copeing successful designs. performance,reliability and public acceptance are a different matter.

May 31, 2007 12:14 PM


lorraine garner said:

copying is the proper spelling, not copeing (last sentence)

May 31, 2007 4:17 PM




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