As he takes the helm of Ford Motor Co. in October, CEO-designate Jim Farley will steer the 117-year-old automaker through one of the most profound product shifts in its history.
The Blue Oval’s F-150 profit-machine continues to steam ahead as the best-selling vehicle in America, but Ford is completely revamping its North American lineup to meet changing consumer and government demands. In the works is a shift away from sedans to slake consumer demand for popular SUVs while at the same time investing billions in electric vehicles to satisfy government mandates.
The shift comes as Ford’s SUV lineup is under pressure from foreign automakers while the popularity of EVs is in question. Yet industry analysts say Farley, now chief operating officer, inherits a Ford and Lincoln model lineup that has made shrewd, measured moves to position itself in the marketplace without overexposing itself to government whims.
“Our new product vision — led by the Mustang Mach-E, new F-150 and Bronco family — is taking shape,” said Bill Ford, Ford’s executive chairman, in announcing Farley’s promotion. "We now have compelling plans for electric and autonomous vehicles ... and we are becoming much more nimble.”
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Credit that in no small part to Farley and ex-manufacturing boss Joe Hinrichs — Farley’s chief competitor for the top job before his abrupt departure in February — who ran the nuts and bolts of Ford’s marketing, technology and production over the last two decades.
“I think Farley and Hendrix really led to the march toward these new vehicles, and I think they’ve done an excellent job with it,” said George Peterson, a veteran industry analyst and president of AutoPacific, who says outgoing CEO Jim Hackett’s strength was high-level corporate strategy. “Hackett was a placeholder until Farley or Hinrichs was ready.”
A century after founder Henry Ford revolutionized the American automobile with the Model T, Ford is undergoing a historic shift in its lineup, particularly with an eye on the rich U.S. market.
“North America is where Ford makes its money,” said Stephanie Brinley, HIS Markit senior auto analyst. And that’s likely to continue.
When it comes to making money, the F-series pickup line is Ford’s franchise. From its debut in 1948, the F-series line now spans everything from F-150 light-duty trucks to F-750 super-duty commercial trucks. Together they sold 896,526 units in 2019, far and away the best-selling vehicles in the U.S.
Before joining Ford in 2007 Farley worked for Toyota Motor Corp. for 20 years, one of the few foreign companies that has taken a lunge at Ford’s pickup dominance. The Toyota Tundra sold 111,673 copies last year.
Credit the F-150’s dominance to relentless change, including the bold decision in 2015 to make a fully aluminum body, a segment first. Ford’s aluminum investment came with huge risks as competitor Chevy/GMC put its truck investment into growing the mid-size pickup markets with the Colorado and Canyon models.
The aluminum F-150 — together with its introduction of new, sippier, turbo-6 cylinder engines — was a hit, but the rest of the industry did not follow its aluminum, lightweighting strategy. Instead, Ford wound up playing catchup as the mid-size pickup market exploded — led by the twin GM products and Toyota Tacoma.
Ford’s Ranger, revived in 2019, has hit the ground running and is now one of the fastest-selling trucks in its segment. Meanwhile, F-series is in the middle of its first major refresh since its aluminum remake.
“The amount of investment they keep putting into the F-150 is impressive,” AutoPacific’s Peterson said. “The 2021 model is highly evolved — they claim at least 92% of all the part numbers on it are new, even though it doesn’t look any different particularly. They’ve paid a lot of attention to the interior craftsmanship and the interior infotainment systems.”
Thirty years ago, the Ford Taurus was the best-selling sedan in America. For 2021, the Blue Oval won’t have a sedan in its U.S. lineup as the mid-size Fusion sunsets with the 2020 model year. Iconic Ford names like Focus and Fiesta will continue to sell in foreign markets like Europe.
Pickups aside, SUVs lead the charge in the U.S.
Riding point will be the rugged, Ranger-based Ford Bronco — aimed squarely at the Jeep Wrangler. Just as Wrangler has defined Jeep’s hot, SUV-focused lineup, so will the versatile Bronco headline a stable of utes, including the Ford Ecosport, Escape, Bronco Sport, Edge, Explorer and Expedition.
“The breadth and depth of the Bronco line is really, really impressive,” said Peterson, including the addition of the unibody Bronco Sport which — unlike the truck-based Bronco — complements the Escape as a more out-doorsy compact crossover.
The Explorer was one of the first five-door SUVs way back in 1995, and it remains a class best-seller. But it’s come under increasing assault from Asian competitors with the all-new Kia Telluride, Hyundai Palisade and Toyota Highlander.
IHS Markit’s Brinley says Ford has reacted by maximizing profits with new premium trims and sharing vehicle platforms. New for 2020, for example, the Explorer introduced an ST performance model that turns heads with wicked looks and bigger horsepower.
“Ford has been getting more efficient by sharing components across model lines,” she said. “It’s making a difference in profitability.”
One example of that sharing is the Explorer-based Aviator SUV. Aviator was the impetus for changing the Explorer’s traditionally front-wheel-drive platform to rear-wheel-drive to complement Lincoln’s re-invention as Ford’s premium SUV brand.
Nicknamed the “baby Navigator,” Aviator echoes big brother’s sumptuous interior and Bentley-like design cues while also riding on a rear-wheel-drive platform. The Navigator, too, shares its platform with a Ford — the F-150 pickup.
With blingtastic design and feathery rides, Lincoln has new life as an SUV brand. The Continental and MKZ sedans have joined the Taurus/Fusion on the scrap heap, and the volume Corsair SUV is just getting market traction.
“The re-invention of Lincoln is complete,” IHS Markit’s Brinley said. “The brand knows what it is, and knows what it has to execute in the future.”
A passionate environmentalist, Chairman Ford has talked a big game on Ford’s green future. But with little consumer demand for EVs, the company’s product planners have resisted wholesale makeovers like Cadillac’s plan to sell only electric vehicles by 2030.
“No EV strategy is a good strategy,” said AutoPacific analyst Peterson, whose organization has polled consumers on electrics since 2005. “Consistently, EV consideration (for a new vehicle) has been between 3% to 5%. There is little consumer pull except for Tesla.”
Still, governments around the world are demanding a zero-emission shift. Ford’s approach is two-pronged.
Taking a page from its icons playbook that has elevated F-series and Bronco, Ford is expanding Mustang as a performance sub-brand that includes a battery-powered Tesla Model Y fighter called the Mustang Mach-E.
Ford hopes the Mach-E will not only rival Tesla in appeal — but also familiarize consumers with high-tech electronics essential to future autonomous vehicles.
On the government compliance front, Ford re-launched the Escape hybrid this year (after a 7-year hiatus) as a practical SUV aimed at the heart of the market’s biggest SUV segment. The company hopes its volume sales will meet government mandates while also satisfying consumer’s core needs of cargo space and fuel efficiency.
Ford’s product shift risks backlash if the market returns to sedans — now almost exclusively the domain of foreign automakers. But with Farley at the wheel, Ford has a car guy with a nose for what Americans covet, observers say.
The CEO-in-waiting, a weekend track warrior, has owned a 1966 Mustang and 1965 Ford GT40 race car.
Henry Payne is auto critic for The Detroit News. Find him at [email protected] or Twitter @HenryEPayne.