At the Brussels Motor Show, we met Jon Williams, European Vice-President and General Manager of Ford Blue, the ICE part of Ford Europe’s business. He talked about the different specialisms inside Ford Motor Company now.
“Recently, we’ve made clear that electrification and sustainability are the main priorities for our company, certainly in Europe,” Williams started. “By 2030, all our cars on sale should be electric, and by 2035, all our commercial vehicles.”
“That’s why we’ve divided the company into three parts, Ford Model e (the electric part), Ford Blue (the ICE part), and Ford Pro (for commercial vehicles). We are confronted with different customer needs, and we want to answer this by providing specialized businesses.”
“For example, I draw parallels with John Deere, the manufacturer of tractors and agricultural machines. They’re no longer just selling the machines, they’re selling solutions to the farmers’ problems, trying to improve their productivity. That’s what we want to do with our customers at Ford Pro.”
Fiesta has to give way
Ford recently announced it would phase out its popular Fiesta model by the middle of the year and that it won’t be replaced. Isn’t that an odd thing to do, given its success? “Fiesta has been a fantastic name and brand for us, but the segment is clearly shrinking. We also need our head plant in Cologne to be fully electrified as soon as possible, as we will produce two new EVs over there.”
“We also see the still rising interest of the customer in SUVs, where the S no longer stands for Sports only, but also for Small. SUVs or crossovers are still gaining in popularity. They also give a higher residual value, and I remind you that the Puma, our smallest SUV, is a sweet spot in our sales.”
Within the whole industry, we see collaborations between OEMs or with start-ups (sometimes taken over after a while). Ford also has linked its business in some segments by means of cooperation, especially in Europe. The US group is, for example, using the MEB platform from Volkswagen for its first European electric cars,
It’s also building the new generation of the Amarok pickup for VW (based on the Ford Ranger, including an electric version) or an electric delivery van as a VW offshoot of the Ford E-Transit Custom. But not everything succeeds; the global cooperation on autonomous driving in the form of the jointly acquired start-up ArgoAI failed.
“Also, in the commercial vehicles sector, our future footprint will be electrified and connected,” comments Jon Williams. “Affordability is key here, and the engineering and production cost plays a big role. Collaboration helps us to increase the number of solutions, and that’s good for our customers.”
New EV platform
As already mentioned, Ford will initially use the MEB platform in Europe as part of the 2020 agreement with Volkswagen. But even though no final decision has yet been made on the future of the cooperation with VW on electric cars, Ford is preparing to switch to its own platform for future electric cars in Europe, according to Martin Sander, Ford’s electric car development manager in Europe.
However, the focus will likely be on larger vehicle segments, not small cars. “We are not looking at entry-level vehicles at the moment,” says Sander. “The company remains open to this in the future, provided battery costs drop sufficiently.” But instead of competing with other manufacturers with vehicles such as the Fiesta or Focus for volume, Ford wants to focus on a different strategy in Europe in the future: it prefers to sell fewer vehicles but at a better price.
Ford is copying what many manufacturers have dreamed of lately: selling fewer cars and earning more money. But what about the affordable car for Joe Average, who hasn’t the means to spend €30 000 and more on a car? “Affordability comes over time,” says Williams. “The market will also move to subscription formulas and will count in monthly payments.”
Williams is not afraid that the average customer will turn away from the possession of a car. “Maybe the younger generation will slowly move toward sharing things, but most people still like to own a car. I see parallels between housing and cars here; they are the most important items people spend a lot of money on, and most of the customers like to control their assets.”