Sunday, July 20, 2008

Rise of a Giant?

Almost 3 years ago I wrote 3 blog posts (1, 2, and 3) about what direction I thought Ford needed to take to reverse their decline as an automaker in the North American market. It appears that Ford is finally considering this plan. I applaud Mr. Mulally for his decision to take this approach, even though I wonder what has taken Ford management so long to get here.

Granted Ford had problems with cars it introduces as Merkur models. But since then, Honda, Toyota, and Nissan has shown how to introduce a new style of autos as Acura, Lexus and Scion, and Infiniti. Part of the problems with the Merkur XR4ti model may have been the sale of it with an American engine available in 2 other Ford cars at the same time. Another was its radical design that was not as conservative as what American's were used to seeing from Europe. Certainly this time around trying existing North American engine options will doom the approach to failure. We need the European cars with most if not all of the European engine options to provide for the range of fuel economy vs. performance that will make the cars appeal to a public paying $4 a gallon for fuel.

There are 2 to 3 approaches that Ford can take with this. I will be anxiously awaiting the coming announcements from Ford to see if buying Ford stock (currently worth just a little more than a gallon of gas) is a worth while investment.

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