Ford Supersizes a Lemon

Ford announced today that it is supersizing a lemon.

DEARBORN-- Two months after it pulled the plug on the massive Ford Excursion, Ford Motor Co. is trying to find a delicate way of introducing a new super-size SUV without undermining the greener image that Chairman and CEO Bill Ford Jr. is trying to project.

Essentially a stretched version of the Ford Expedition, the new SUV goes into production at Ford's Michigan Truck plant in Wayne next summer, according to analysts who track future car and truck products. A longer version of the Lincoln Navigator will also debut next year.

The launch of the new vehicles will coincide with refreshed versions of the standard-size Expedition and Navigator.

Ford's new super-size SUV has been referred to internally as the "Ford Everest," a name Ford uses in some markets outside the United States. But that moniker vanished into thin air once Ford's marketing division recognized it would only draw attention to the SUV's size.

If there is one lesson Ford learned from its ill-fated Excursion, it was the importance of staying on message.

Ford's new entry will be over 19 feet long, about 15 inches longer than the Expedition, and will boast significantly more cargo room behind its third row of seats, analysts say.

Unlike the Excursion, a 20-foot SUV built on a heavy-duty truck frame, it should be able to fit in most garages.

Even so, Ford's new SUV poses a significant marketing challenge in an era where SUVs have become symbols of gas-guzzling excess.

Earlier this year, Bill Ford redoubled the automaker's commitment to environmental leadership, launching a plan to build 250,000 hybrid vehicles a year by 2010 while simultaneously developing a host of other alternative powertrain options.

"It's a pretty big vehicle that kind of runs counter to their hybrid approach," said Erich Merkle, a brand analyst with IRN Inc. in Grand Rapids.

Jim Hall, an analyst with AutoPacific in Southfield, said Ford is only giving its customers what they want.

"This gives them something to counter the Suburban," Hall said, adding that environmental responsibility is not the only message Ford needs to convey today. "They have another message they have to communicate: 'We're in business to stay in business.' "

Well, if there is one thing I have learned it is that Ford has learned nothing.
For a company slashing 30,000 workers and closing 10 plants, is this the best they can come up with? Then again because this is the best they can come up with is precisely one of the reasons they are slashing 30,000 workers and closing 10 plants in the first place.

Some questions for Ford:

• What happened to the commitment to "redouble environmental leadership"?
• Is Ford really giving consumers what they want? If so, why are sales slumping?
• Are Expedition sales slumping because they are not big enough?
• Do consumers need cargo room to haul junk? Is that the story?
• Why does Ford need to counter the Suburban anyway?
• When everyone is countering everyone else is anyone going to do any good?
• If you are going to play the countering game, why can't you at least come up with a design that someone else has to counter for a change?
• What happens when consumers can no longer afford the models you are making?

"It's hard to wean yourself off of them. There's just too much money on the table," Langley said. "They're the crack of the American auto industry."

I guess we will see about that next year in the consumer lead recession when SUV will come to mean "Simply Unsellable Vehicle".

Andy Rooney spoke about cars on 60 minutes this past Sunday. Let's tune in:

The funny thing is -- it isn't really funny it's sad -- I feel bad about the decline of our auto industry but the last three cars I've bought were not made by them. They weren't made by any American car company.

I hate to say it but we no longer make the best cars and Americans are turning away from them. The Japanese Toyota has been the best-selling car in the United States for several years now.

Consumer Reports tested a lot of cars and gave their highest reliability rating to 31 of them. Of those 31 most reliable cars, just two were American. The other 29 were Japanese. Of the cars that were least reliable, 22 were American made.

I have an idea for getting American auto makers out of trouble so they don't have to close plants and fire workers: spend less time thinking up clever names and more time making better cars.

Ford's big plan after cutting 30,000 workers: It supersizes a lemon.
The big dilemma now for Ford: What to name it.

Mike Shedlock / Mish
http://globaleconomicanalysis.blogspot.com/