Why Ford may Make It

In all this turmoil we are currently suffering, and government backed loans not withstanding, there are real concerns about the future of the big three. The private equity company that purchased Chrysler is fast finding out that running a car company is pretty complex and difficult. They also should have done their homework regarding the product pipeline and the consumer perception of Chrysler vehicles. It is fixable, but not any time in the next 12 months.(Chrysler will be the subject of a future blog).

Ford, however, is different. They are currently doing well outside of the US, which indicates that they have some pretty good, market-specific vehicles in other countries. Ford is planning on bringing some of those vehicles here in short order. The 2010 Ford Focus is a fine car, and the Focus line in Europe has been selling briskly. The other vehicle to appear soon is the Turkish-made Ford Transit van.

Ford is making itself a very interesting niche in the market. Young people will love the 2010 Focus (some of the features on this vehicle - such as Sync, a Ford/Microsoft developed mobile entertainment and communications software - are already available on the current US Focus, and are a hit with young consumers). It will not be seen as "so 20Th century" to be seen in a Ford product. With the weakness of the US Dollar, imported vehicles from Europe are still cool but increasingly out of reach for this demographic. Chalk one up for Ford.

The Ford Transit is a vehicle whose time has come. Small businesses will simply have to wean themselves off full size vans that get 10-15MPG in the city (the same goes for pick-up trucks by the way). The vast majority of small businesses will be able to get by with a stylish, small and fuel efficient van. They will have to - current decreases in oil prices are still making for comparatively expensive gas, and the business owners will soon discover the advantages of smaller engines in a recessionary economy.

The basic question facing the big three is do they have enough cash to last until their new vehicles are available? Ford has a good chance. They have some profitable operations overseas which makes them, in theory at least, a good candidate for outside investment. Ford however, is doing something very clever. They are getting out of the commodity business. By introducing niche, different vehicles popular elsewhere, they are going after a clientele of savvy consumers who want something different that is cool, and in the case of the Transit will save them substantial amounts of increasingly scarce money. They are, in short, betting that there are educated, savvy and cool consumers out there who will buy a product that is good value for money, cool and has a certain flair. If you want a vehicle that answers that description stop by a Ford dealership - next year.