focus05

Aside from the environmental positives here, actually, if you look available supplies (proven and unproven reserves), increasing costs/risks of drilling (technical complexity, political instability), energy consumption growth, etc. $7-$8 might be the right range in about 10-15 years to fully supplant oil and gas even without excess gov't subsidies for the fuel. If you look at all reserves of oil and gas - proven and unproven - we've got 150 years, but that quickly becomes more expensive to extract because deposits are lower, harder to extract, require moving people, etc. Either we drastically reduce consumption to spread out the low price reserves (roughly the 10-15 years we're currently drilling or plan to drill) or the cost of consumption goes up. Aside from keeping global warming under control, we will need to diversify our energy consumption to keep prices lower. And for practical applications, aside from the fun of driving an ICE, we will need alternatives like efuels where solid energy storage (e.g., batteries) will take decades to be viable, like in airplanes.

Ford has suffered from very poor product planning - not just rollout schedule, but actually reading the needs of the market; their products are often too limited for broad appeal (Focus with its backseat). Their C-segment CUV is average. Their midsize car is underwhelming and standing still as competitors accelerate. Their C-segment car is not quite right for the market. They have no real B-segment CUV yet (EcoSport is a placeholder). And then, it's all behind schedule. Their initial Ecoboost boost is also fading as competitors roll out with better GTDI engines. The 1.5 3 cylinder is behind. The 1.0 is now surrounded by equals (and some better). Their hybrid tech and strategy hasn't moved in years. Their new transmission rollout is slow. Their interior design has been stuck in reverse for about 5 years. I used to be a huge fan of Mulally, but I realize now that he left the company on shaky ground with unclear operating and investment principles. Fields was unable to set them up. Let's hope Hackett gets the ball rolling. On top of all of this, Ford cannot stay out of the news for recalls or lawsuits for this or that issue. The supply chain appears to be a wreck and assembly quality appears to be below standard for mass-market manufacturers. All of which needs to get straightened out. All of this matters because the industry is starting to iterate much faster at the commodity level - software/tech, interior, powertrain. Body changes will slow and be reserved more and more for higher end vehicles where personalization can afford to go beyond colors. Ford isn't set up for this world, and they need to be in the next 2-3 years.

To this, I would say, patriotism always loses to product in the end. Ford does not have the right product right now in the small car segment. In the long-run, that's the only thing that matters.

I think the move is driven by something a bit deeper, which is: the preferences of American buyers at the lower end of the scale (e.g., not luxury) is closer to those of Chinese than European. And if you want scale and efficiency (ie - you don't need two sets of tools), the better to produce it in China. For example, Americans and Chinese value back seat space more than Europeans. Americans and Chinese consumers value quality (different from reliability) less than Europeans - so the return on material selection is lower for those markets, e.g., harder plastics, faker leather, etc. Foci will be produced in essentially two large locations: one in Europe that caters to more European tastes + performance vehicles and one China that caters to the rest of the world's standards. This means I expect wheelbase and dimensions to vary a bit by where the car is sourced (we'll see if I'm right). You could argue that somehow Honda manages the Civic in the US, but to that I'll say the Focus does not effectively match the needs of the average American small car consumer (yet again) - too little rear seat room, lower reliability, poorer balance on fuel and performance. As a result, the real ATP of a standard Focus (not ST and RS which have limited market appeal) is lower than a Civic while volumes are lower as well. You can imagine the fixed cost of both being similar, which means the net profit is weaker on Focus. In 10 years, depending on the market and Ford's ability to execute the right product efficiently (the real reason for Fields' departure), maybe small car production returns to our shores.

I may be reading more into this than there this, but this appears to be a beta test of what you'd expect a driverless car system to do for you. In the future, even if we still *buy* as opposed to *share* driverless cars, it will be common for the car to drive you to work and then go park further away where it's easy. It could "run errands" if there is official standard for exchanging money and goods with the car. It could drive itself to servicing, to get fuel, etc. Ford may be trying to figure out what people value the most in terms of services so that they try to automate them through driverless first - thus creating higher value in the technology when it's launched.

We're missing a massive trend in this, though: the rise and fall(ing price) of solar energy. The cost per watt installed now is just about equivalent to oil and has all but left coal dead (sorry West Virginia). In a few years, even with subsidies disappearing, solar undercuts everything else. Storage, one of the key challenges of renewables, is becoming vastly cheaper as well. Enough so that every new house should be built with solar installed. The drop in storage leads to the second point, which is electrification of our car fleet. I don't expect this to change. Tesla, GM, Audi and others will see to that and the only thing that will change that is some magical ICE improvements. It's not just the full efficiency plant to tail pipe, but the dynamics of an electric vehicle (torque!). On a more practical level, as storage become cheap, driverless + electrification is basically the panacea of local delivery. I guess what I'm saying is: having all this shale oil is great. Drill baby, whatever. But honestly, I would go full bore into the trend (solar + storage) and decouple ourselves from imported oil and allow our deposits to stretch as far as they can until they are eventually supplanted by biofuels altogether. You want to see our trade deficit evaporate in the next 5-7 years? There you go. That's your policy.

Wow, lots of heated opinions on this topic. In general, my perception around the current gen Focus is quite negative (and I bought a loaded one in 2012). The question of whether Ford is issuing subprime vs GM is sort of beside the point. I don't compare Ford to GM. I compare them to the broader automobile market. Ford did several things well with this new car (hatchback!). But they also have several issues with the current gen that they failed to execute well on: Small interior - it is one of the tightest interiors in the class for legroom. Was from day one. That might be ok in Europe, but it doesn't fly in the US (or China) if you want to compete with the Civic/Corolla (gotta match the product) or if you want to compete on price (bang for the buck). Poor transmission - Ford completely bungled this one. It has left a negative perception around the Focus in terms of quality, meaning that you are forcing yourself out of the Civic/Corolla competition from day one. No hope going back. Econopremium - They missed the boat on interior usability in version one. The refresh was decent, though. However, they mixed premium features with poor quality bits here and there (NVH, some bad plastic moldings, low quality cloth seats) leading to a car that is neither budget nor premium. And then, failing to compete with Audi A3, they went straight to discounts on an econopremium product. Confusing options - the topic of the thread. The array of packages and combinations of tech are stupid. 97% consumers don't want to configure in detail. They want a good package, and off they go. I think Ford has also messed up some of their packaging, like how they bundle certain potentially desirable features into Sport packages that add styling features that might not appeal to mainstream buyer. I read most of this as Ford not knowing what it wants to be. They had a good product in Europe but no one who could step up and drive the ship in the US to make sure the product translated. To me it was an exercise in bean counting, just starting with a better product from across the pond. The Focus is about to have a really bad 18 months before the model change over. And even then... The grouping of options will help a lot to clarify things, but if I were the 2017 Focus product manager, I would be thinking about who buys the vehicle, where it's positioned, and do the following: Take the hatchback premium and the sedan downward Add the 1.5 turbo to the hatchback along with the 6MT and 6AT Keep the cheaper 2.0 in the sedan with the 5MT and the 6AT I would update the classes in the Sedan: Sedan would get a "Studio" with all the basics a rental car would need (LX in a Civic), an "SE" that is more like Honda's EX and an "SEL" that is more like Honda's Touring. I would create just 1-2 packages per trim + some transmission, wheel and color options. You could also give these levels names like Trend or Style or something. For the hatch, I would start at "SE", keep "SEL" and I would make the Titanium stand out a bit - minor fascia or body touches to make it feel unique and premium. Maybe even give the normal hatch the 148 hp 1.5 and Titanium the 178 hp version. Ditto the options. Of course, the ST and RS would stay. I would also spend time figuring out ways to incentivize dealers to sell small cars. Right now, they are good at trucks and SUVs. That hurts you because even if you have a good small car product, your dealer body will always view the small car as a "cheap thing." Ford, however, seems to be paralyzed when it comes to decision-making and not focused enough on the end consumer's needs. I suspect too many specific decisions are still top-down rather than being bottom up based on general guardrails or principles from the top. At least, that's what it seems like (global low-cost B car - wait no; no US Ranger - wait no; no real EV - oh wait, we'll also do 5 EVs; and now driverless!) Not disagreeing with Ford's broad priorities - they need to figure out how they fit into an electrified and driverless world where cars are a shared resources rather than an independently owned resource. But that means they need to know their Customer. If they don't want to know about the small/compact car customer, fine. But then cut the model. Don't let it hang around half formed. Seriously. Cut it. Ultimately, I think Ford should be working overtime figuring out commercial vehicles (driverless Transit and Transit Connect; interaction between drones, bikes and other small vehicles and their larger vehicles; electrification; fleet deployment technologies - e.g., Ford as a platform?). They have the connections deep into those industries. I would be going all out there.

Actually, Japan has little control of its currency at the moment. They were trying to devalue it recently to help spur inflation to save their economy. However, after three years of pumping money and interest rates in negative territory, their currency has not moved. Currency manipulation has nothing to do with it. One of things that the Japanese government does do is provide significant R&D support to their industry. Toyota's hybrid program wasn't just something it cooked up and took a bath on for 10 years while the industry learned. That's the sort of investment I wish our government could have the nerve and foresight to foster.

I agree that it is anecdotal at best. (quick check, though, there is no CRV V6). My reference point is similar to what you've pointed out: EB 3.5 in an F-150 that struggles to get 18 mpg cruising at 65-70 whereas the GM 5.3 is getting 19-20 mpg. And, yes, the 3.5 is faster, but not vastly. Bigger point: Ford has taken a really complicated path to reach these powertrain numbers which are, in my opinion, not that interesting. For all the pomp and circumstance around their powertrains, the point is that Ford still does not have differentiation in hard numbers in that department. Given how few departments they are differentiated in, that really concerns me about the future development of Ford vehicles.

There are a lot of things that go into this decision. For example, protectionist policies like South American trade fights has led to Mexico, even at higher wages, being a better place to produce some vehicles. There is a zero-tariff trade scheme down there. I don't think the tier1 vs tier 2 thing is really the point either long-term. Sure lower wages in the US would keep some jobs in the US a bit longer, but automation will ultimately be the cheaper route (capital returns vs labor returns). And that's the much bigger threat to low-skill manufacturing jobs: automation! You can bet that the moment those wages in Mexico or China rise that Ford will automate as much as they can (and they can automate a lot since there is no union there). We should accept that we cost a lot, that holding back against cheap labor is not a winning strategy, and focus our energy and resources on educating more technically skilled and productive workers. Period.

Higher wage producers will, in the long-run, be out-sourced to lower wage labor or be automated away. I just wish we could retrain our workforces faster. It's not globalization that we should be mad about; it's how little we (gov't, community, family, personal) do to support those who need to build new skills to get a new job and become more "productive." If I were running the UAW, I think I would make it my mission to actually train and educate workers up and out of my low-skill workforce over time. It might actually make people want to join the union and companies want to (pay to?) work with it. Sort of like the consulting companies do to new college grads - take 'em, train 'em, and then push 'em out of the nest in the hopes that business comes back in the future.

Having GDTI across the lineup is not impressive. It's just how Ford has invested. Having a set of GDTIs that, on balance, return the same mileage and acceleration as less complex GDI engines offered by other manufacturers makes no sense to me. Ford's truck applications are a great example of this. The Fusion's 2.0 liter is poor in terms of performance and economy vs Accord or Camry. The Escape's engines provide little if any advantage vs CR-V or CX-5 (of course, both the Fusion and Escape get updates for 2017, and I hope real progress has been made with the twin scroll). I can add more thoughts about Ford's product strategy later. In general, they are obsessing about the right cars, but their boldness in those segments and against the growth of competition from below (Hyundai) and above (Audi) leaves a lot to be desired.

Ford's adherence to One Ford while not cutting through all the organizational mess, I believe, is a core cause of the lack of direction in their small car strategy. You have 3, maybe 4, different markets when it comes to small cars - Europe (mid-scale, around 4m hatch); Emerging Market (low/mid-scale, <4m hatch for India); and NA/China (low/mid-scale, around 4.4m sedan/4.1m hatch). Honda has bridged these with the Fit/Jazz and makes a modification for India and de-contents for 3rd world. But its quality reputation carries its ATPs and it lives with lower volumes in Europe. Toyota uses the Toyota Vitz/Yaris to be sub-4m out of the box, ditto above. Hyundai has a separate car (Accent) for the US and China/Asia while providing the i20 for Europe and India all on the same platform with many shared parts but different designs. Ford is still trying to figure out what it wants to be. They like their sales volumes, but they want their ATPs. They don't have a strong enough reputation to get those higher ATPs in any country (quality, technology, German) other than with F-series. They're hoping to fill in gaps with vehicles like the Ka/Figo or Ecosport to save money when those vehicles are poorly suited for the target segments in Europe or the US. Overall, I see a mess at Ford right now other than driverless. Their engine technology seems to be lagging the field. Their electrification strategy is lagging the field now. Very little leadership on strategy. A lot of bureaucracy. No forceful and urgent bets other than driverless, and they will likely end up behind in that because they are not Google, Amazon or Tesla. Their One Ford strategy sounds great, but they have too much red tape to actually scale effectively globally. Mulally had the right idea and made some strides, but didn't do enough house-cleaning. Fields is executing it poorly and needs to clean out more mess. The best move made recently was splitting off driverless. That might save the company from itself in 5 years, but it's going to be a rough next 5 years for Ford, imo.

Honestly, this is a s**t product. I'm struggling with this CUVs role in a US portfolio. It is 160" long - 7-9" shorter than other B- CUVs. It could be the first "A" CUV. Really, really small. But I'm not sure Americans want really really small. It's not an off-road product by any stretch. It won't be more fuel-efficient. It doesn't seem to out perform its peers in the UK. Ford needs to re-think their entire A/B and emerging/developed market strategy. I suppose they can bring cheap, small, compromised CUV like this to the US, but it would be dumb, imo.

I noticed the cliff with my 2013 Ford Focus. 55-60 mph was the sweet spot. I could get 42-43 mpg all day driving there with low profile tires even. Get to 70, and it was down to 36. Get to 75 and it was down to 34. Get to 80, and I'm at 31, which is not much different than my 2005 Focus was at 80. For the 2012-4 Focus, I'm pretty confident it was the gearing that made the difference. Ford seems to have optimized the gearing for the EPA tests. My guess is that they would model that optimal load points in the rpm band, get the engine there around 60 in top gear for the EPA test and Bob's your uncle.

Ford's small car strategy is pretty poor in total at a product level, although maybe, at the time, reflected appropriate investment at a business level. Their small car packaging is bottom of the industry at best with many of their product suffering from poor interior room even comparing exterior dimensions. The new Figo/Ka are relatively large in their exterior dimensions for the interior volume they deliver as they sought to re-use a platform. Same with the Fiesta as Ford pushed to stay sub-4 meter for India instead of creating two lengths like most automakers have - one for India, one for ROW - by making low cost changes after the B-pillar. The Ecosport suffers from the same sub-4 meter cramming mentality, which gains 10,000 sales in India but loses probably 100,000 elsewhere around the globe. VW has a better approach with a purpose-built city car platform underpinning the up! and spawning a CUV in India that is sub-4 meters by design instead of shoe-horned into sub-4 meters. Europe shows us that the 167-170 in length CUVs probably outperform the short and more cramped Ecosport. I believe that will be more true in the US. What's the right strategy? Not exactly sure. I don't have all the facts. But if I were Ford, I would think about a true City platform (borrowed or designed) to spawn an up! competitor and a CUV in the sub-4 realm and figuring out how to make them adaptable from India and Brazil to dense cities in Europe and China. Then, Fiesta can have its own platform and models. You can still have a sub-4 hatch, but you have more flexibility in designing the vehicle with style and space. From there, the Fiesta, B-Max and Ecosport can be better targeted at the EU, US and China markets while still service the emerging markets partly.

Talk less. Act more. Innovation rarely works internally if the culture wasn't built that way to begin with, imo. Richard sort of had it right earlier: the business has to focus on its core. Its shareholders and corporate structures force that at this point. As "innovative" as they might try to be, they will always be struggling against upstarts. There are two ways to break from that past: Force faster iteration and/or upgradability. Historically, the automobile industry has moved in 3-4 year minor cycles and 6-8 major cycles. The talk is always about amortizing cost rather than innovating rapidly. I dare Ford to challenge product and manufacturing teams to increment faster at lower costs. Invest in startups outside of Ford and encourage your workers to go outside of the company and develop technologies. Create an incubator and lend your scale to the start-ups. In either case, the core capabilities where Ford needs to outstrip its competitors are: manufacturing, systems engineering (hardware, software) and regulatory control. If you have industry-leading flexibility in all these areas, you can iterate on your products vastly faster. To grow these, internal goals or external investments are the way to go. The other thing Ford cannot easily do internally is consider new business models. They will never make sense in the context of the company and its massive budget. Another good reason to fund start ups and companies outside of the mother ship. For example, Tesla is betting that by open sourcing its patents, more people will use its battery technology. If they do, they will use the Tesla charging stations and generate additional revenue. Eventually, Tesla becomes a nearly pure energy company rather than an automobile company. Brand new revenue model. Ford has no reason to open source its EV patents, which is why they didn't really do it. There's no bigger business opportunity for them. They just sort of opened them for a fee. Try again. There are ways for Ford to innovate, but it must think significantly differently.

The results were weak, not bad. Ford's results in April 2013 were quite good and this has just more or less put them back in the pack. It's sad, though, that Ford doesn't have staying power, particularly in cars (e.g., maintaining won marketshare). Some details of results: Cars are pretty weak right now. Part of that is cyclical (Taurus, Focus, Mustang have been around). Part of that is quality perception. Features that push boundaries like MFT, DSG, Ecoboost are to blame (and not necessarily because they break - they just don't perform as expected), but those are also items that sell the vehicles. The Lincoln result doesn't bother me in the slightest. Jeep is probably hurting Ford more than other brands (Escape/Edge - I bet a lot of these guys were once Cherokee owners. Nostalgia is powerful). Some trends to watch: I believe Ford is losing the gas mileage perception war that was helping it for a while. I think the C-Max effect has spread beyond just the PHEV and includes the ecoboost cars in particular as well. Ecoboost is not performing in terms of mileage based on what was originally trumpeted - certainly nothing in the 15-20% range. This is less of an issue on the truck side, imo, mileage is important but such a secondary consideration to other utility factors. Which means Ford may have a brand problem with its cars again (still?). Why by a Ford car vs Toyota (reliable) or Honda (good all around)? If you can't differentiate your brand, you can't maintain won marketshare. Ford has done a great job with truck branding and ok with CUVs (although I'd argue that they are coasting on historical perception more than they should). So, launches kick off marketshare gains, which are all lost as the model ages and only maintained at old levels through price moves. Fusion will tell us a lot. I'm betting right now that Ford trucks will cool off in 2016/2017 finally as consumers get used to the technology of the F-150 and GM/Ram catch up. I just expect that some of the technology changes will be "difficult" to handle. At least Ford has that brand. Are the cars bad quality because they are European? Probably not. Although, I suspect there are some global integration problems. It's probably that Ford is pushing the boundaries more in its European-derived products (DSG, ecoboost, MFT... sound familiar?). I also believe that the European vehicles have a fundamental sizing problems. The Ford products are considerably smaller in interior size than their competitors without similar dimensional reduction. That will hurt them over time (if not already). There are also usability problems with the interiors. The interior designs are rubbish, imo, but I've already spent time on this. I'll be watching a few things in the months ahead: The 2015 Transit launch. By Sep we should have some data on whether Ford made a good call (I think so). The 2015 Focus launch carefully because it will bring the car back to the forefront with all its baggage (MFT, transmission issues), it's great attributes (driving experience), and some improvements (ecoboost, interior). F-150 goes without saying. The Mustang launch... meh. The MKC is the launch to watch for Lincoln. So we'll have data by Sep/Oct on the fate of that brand.

Ford's quality problems are almost all about the fast shift in technology and not creating an experience that consumers understand. The "problems" with the DCT aren't really about them breaking - a 1980s type problem - it's that they don't work as expected. They roll like a manual with a clutch. They have hard shifts sometimes like a manual with a clutch. Better programming can overcome much of this. The folks in the BMW forums and MB forums are much kinder to dual-clutch technology. CVTs suffer from the same types complaints. The "problems" with MFT/Sync are not that it fails, but that it is not intuitive to use. The UI is still bad. The hierarchy of information is hard to use. There's just too much functionality in one go. Ford did listen to the consumer when Mullally came in. They built much more sophisticated products with much higher "quality" of feel with enough technology to power the space mission. But it seems they stopped just short of actually listening. Too much looking at CAFE, a lot of looking at commonality as mentioned above, and not enough looking at standards of usability. The 2015 Focus addresses the MFT issue in a way that Ford knows - add better knobs and buttons on the dash. Ok, a good turn knob isn't a bad thing... But, I'd advise Ford to focus on three things with MFT/in-car software: 1) the ease of upgrading - the easier it is to upgrade the software, the faster (and invisibly?) you can send upgrades and test changes; 2) the ease of interfacing - knobs are a blunt instrument because the hardware is permanent, but voice, the touchscreen, and your phone are software interfaces that can change all the time; and 3) the content hierarchy - I found the failure of MFT in my Focus was that I had access to too much too quickly when I really only used 5-6 functions ever. That's my free advice. If you want more, I charge $150/hr.

I think this is exactly what Lincoln is doing (eventually). If I read the cards, the product cadence looks pretty good. MKC is the first truly new Lincoln. The MKS and MKX are probably coming for 2016MY. I would venture that there are Lincoln's based on the Explorer and Focus structures coming in 2018 when those models get bigger updates and the platforms can be looked at more significantly than an MCE. That's basically adding 10-20k of volume every year at constant industry volumes and similar share to today's models (both of which could be volatile in the next 5 years). Not too fast. Not too slow. At the same time, they can ramp up the brand's international presence a bit to maybe 30% of the brand's volume. At which point, in 2020, I have a luxury marque with volume (200-250k globally) worth taking a chance on separating out more wholly from Ford. Possibly with larger platform and technology variations and maybe even the halo model that everyone is dreaming about (but no one will buy). All of which will take another 6-10 years of model cycles to bring in, but the investment can start. But, it will also demand much greater differentiation of the experience like what Black Label is exploring in the US and Vignale in Europe. If I were a betting man, I would suspect both of these programs are not meant to treat people differently over the long run. They are to assess the return for Ford's investment in certain "amenities." By 2020, if Lincoln performs as expected, I don't believe there will be a separate Black Label experience in the US (or Vignale in Europe for that matter). What I expect is that all of Lincoln will have a set of features in service and support that are truly value-add for high-end customers and the brand will use them in the US, Europe, China and elsewhere. Ultimately, though, the sad truth is that the gap between luxury and non-luxury brands is narrowing, particularly as regulations and natural resources globally become more expensive. I believe Ford will be 2/3 fleet in 20 years in the US and higher in some countries and most individuals globally will only own cars "on-demand." People actually buying Fords will be paying what we consider near-luxury prices. Lincoln will have to use the personalized concierge experience of ownership to create a luxury marque along with some nominal differences in platforms, materials and technology. But it will be the "access" that Lincoln affords that will keep them unique in 2030 and beyond in this highly commoditized industry.

"We're only going after volume..." Then why the heck do you still have the MKS? That car competes with no one other than itself. It's not engaging enough to be an A6 competitor, let alone an A8/7-series/S-class/LS competitor. It's too big to be a 5-series, GS or E-class competitor. What is it's function? "We're targeting a younger demographic..." with a car like the MKZ? The primary buyers of luxury cars in their 30s and 40s are men. The MKZ will be a woman's car. Women, being the far more intelligent gender, are more prudent with their money and will hold off on luxuries like this until their 50s and 60s. So, you might gain some traction under 70, but it's going to be a lot like the ES's traction below 70. Female, dual-income, kids in college or graduated, 55-60. Lincoln's product plans as it should be: start by copying Volvo. Build volume. Add interesting stuff. I'm serious. 1. Phase out the MKS and MKT. 2. Create a direct Q5/XC60/X3 competitor. Built on a shrunken EUCD platform, shorter than the existing MKX with less bulk and more toned muscle. Weighing in at 3700-4000 lbs depending on config, it should be powered by a premium fuel only 270 hp 2.0T. The hybrid should be more "performance" tuned than the 2.0-hybrid system in the Ford's. It should probably be based on a 2.5 or 2.7 engine 3. Create a direct A4/S60/3-series/IS competitor. Doesn't need to be RWD. Built on a shrunken EUCD (see, Volvo...), shorter than the MKZ by about 7-8 inches with less niceness and more naughty. Weighing in at 3400-3600 lbs depending on config, it should have similar engine and tech options as the CUV. 4. Once there, build out the GRWD for Lincoln. Make the MKZ (or some new name) a real 5-series competitor. Or make a real D platform that is AWD-focused, shrink the length relative to the current Taurus and make a real A6 competitor. Either will do. This would be a candidate for the 330-350hp 2.7 turbo along with a diesel and hybrid. 5. Add in your 3-row luxury CUV here on the D/GRWD platform. The Q7/GX/sort-of-X5/Land Rover-type competitor. 6. Keep the Navigator and do just what I think you're doing. Update, differentiate from Expedition, add an ecoboost, and look at alternative power trains (diesel/hybrid). Keep it an almost real truck. 7. When the brand is steady in, say, 2016/7... Create your flag: the Continental. Think 7-series/LS/S-class/A8... Probably a mostly unique platform (if MKZ is D, then a unique AWD like A8; if it's RWD, then a unique RWD like LS) with innovative drivetrains - probably some hybrid that is "experimental" in that it's expensive to produce but that cost nets you uniqueness in the class. 8. A coupe, probably built on the same platform as MKZ or Mustang (or both if it's GRWD). Again focus is on unleashing engagement while using an innovative powertrain. 9. By 2018/2019 a 1-series/A3 competitor built on a heavily modified (from now) C-platform. Cities are getting crowded pushing basically everyone into smaller and smaller vehicles globally. Then, you have 8 products. Globally, by the end of the decade, if things go ok, your top-end sedan and coupe will muster only 50k combined, and your BC-segment might make it another 50k. But your CD class will likely be rocketing through 200k units per year combined while your D-ish car and CUV will likely add another 100k globally. All in, you're at 400k globally (4x now). Lincoln becomes your "cutting edge" brand where you test out things like tech, self-driving, powertrain innovations, etc that are hard to scale because of price, production, or any number of variables. But it also leaves room for Ford brand to scale up without hitting Lincoln directly. Your sizes are slightly different. Technology adoption curve is faster in one than the other. Because of that, a very refined and extraordinarily well-equipped Fusion could push into the mid-$40s without stepping on the MKZs toes or your slightly smaller CD car's toes. The dynamics, room, design, and function of the vehicles has some divergence other than a fancy panoramic roof. It seems like for all their bravado, they are still trying to bootstrap this operation and reinventing the wheel when Volvo has shown them exactly how to modify EUCD and Audi has shown them what they need in terms of dynamics in a FWD/AWD world. I also still don't know what the obsession with MKS or MKT is. Kill them. Frankly, they didn't work. And they won't given Ford's current contextualization of them. They have no competitors, really. The MKS is completely unique as it can't hold a candle to the A6 or A8 and is too big for 5-series, GS, etc. A bloated, boring barge in a taut luxury world. So... what's next with them, really? I wish them luck with Lincoln, but I don't actually see a really good product plan yet. That said, I also don't know what they are discussing internally... so I'll wait patiently while this drama unfolds.

This is being repeated at every company that awards risk-based compensation right now. I had options grants at my company from 2009 fortunately. At the time, it was a small amount of "face" value. But the strike price being so low it also meant a large number of options. Exercising those today at even beyond pre-recession levels rocked. I certainly don't get compensated at Mulally's level, but it's a really nice boost unrelated to anything other than stock performance (which theoretically is a health metric of the company as a whole). It's sort of a one time chunk - well, it might repeat itself a final time next year for the last time - but then it's all over. And our options award the last couple years (and particularly this year) will be worth much less. I think stock compensation is stupid because SEC regulations on reporting actually probably screw up priorities and force companies to act in short-term interests rather than long-term (e.g., we sacrifice something today to meet our EOY numbers estimated in SEC filings and speculated by analysts, and that will hurt us down the road). That causes increased compensation for what could be bad behaviour with respect to regulation... And heavy stock options can skew internal behaviour as well, separately from SEC regulations. It also ignores macro-economic trends. The whole stock market is up. The economy is up. Does that mean my company's good performance was a result of my work - or of larger externalities? But good for Mulally. I like him a lot. And I still believe he has been worth every penny.

The YTD rental fleet number doesn't make sense. They were 8% in Jan according to the sales call. 15% in Feb. That works out to be 12-ish% overall YTD. Was there some revision to the data?

Perhaps the thing that bothers me the most is that the Fiesta and Focus, while excellent vehicles for a driver, seem to miss a general consumer trend I see beginning - which is the downsizing to the right-size. But that implies the down-sizing requires reasonable trade-offs in interior space, footprint, mileage and performance. The Fiesta and Focus fail miserably in the interior space trade-off. In Europe this shift has meant the shift from C-cars into B-cars. That shift is nearly complete. And there are B-cars (the Hyundai twins, in particular) who meet the functional needs of the B-class buyer. Even the new Yaris and VW's Polo beat out the Fiesta for interior space. That lack of space means that the C-car buyer can't actually shift as easily into the vehicle. We're not talking about ridiculous propositions about how much legroom and such are available - trading to a B-car for fuel economy and smaller exterior packaging means you are trading off *some* space. But you still need it functional enough to carry you, your partner, and your kid with some luggage/groceries occasionally or perhaps a friend or two from time to time. Using space efficiently in a compelling design will win this downsizing trend. The B-Max will solve this need, but it's bigger, and importantly it will cost and weigh more. Meanwhile Hyundai may have nailed the packaging. Chevy's Sonic is pretty good. The Fit is fairly popular world-wide even given Honda's overall brand performance in Europe. The Fiesta cannot be an easy trade-down from a C-car. A similar thing is happening in the US with trade-down into C-cars. People are starting to shift from CD-buyers to C-buyers. The reason the CD-segment still does so well is that luckily people are shifting out of SUVs and trucks into CD-cars. The Elantra and Cruze, again, get the package down fairly well - the Elantra has just enough space to be called "midsize." They might not be the most engaging cars, but they function really well and, in the case of the Hyundai, cost less. Just like the Fiesta, the Focus cannot be an easy trade-down from a CD-car. In fact, there are B-cars with almost as much room as the much larger footprint Focus. They just lack the width. The Focus does not really have the versatility for a family. Maybe a really young family or a short family. Perhaps I'm wrong about all this overall trend, but I don't think so. The reason that C-cars have become so well designed and contented is that manufacturers recognize that people actually *want* a small car rather than need to get it because it's cheap. But with that shift comes some expectations on functionality and requires manufacturers to think about product planning beyond just what infotainment system they put in. And it pains me to think that Ford might actually be stuck with the current Focus's interior dimensions for 6+ years before the next gen with a modified body and increased room debuts. And while, I suppose, we could hope that emotional reasons for buying might trump practical, the Focus is not a BMW and is not considered in the same way. And even if Ford feels like the choice and long-term satisfaction should be based more on emotional appeal than anything else, I would caution that the brand, sales goals, and product positioning does not reflect that stance. And so product and marketing need to line up really well on this one going forward.

Cruise control: it took a while to understand it, and I often hit the "off" when I meant to accel or decel. Climate control: They are in a strange place behind the shifter. It would be ok if the driver never had to reach to the other side where the passenger controls are - but you do as some of the defrost functions are over that way. And in winter, the shifter was often in the way of that. You'd probably get good over time of hitting the right button, but it's annoying. Radio/sync: The navigation of sync via the controls was not intuitive and sometimes just confusing. I stopped for 15 minutes at a gas station to play with it and try to understand it, but then I still continued to encounter random navigation issues when setting up devices, configuring sync, etc. For example, the lower selections in the sync screen didn't seem to line up to anything on the control panel. Bad design. The process of hooking up a device is long in ease-of-use terms. Yes, a couple clicks, but long. And the reality is that you probably go through the process with your phone, and ipod, and your partner's phone, and your mom's phone over time... etc, etc. You eventually get good, but it takes a while. So some of it is ramp. But I think of it like the iPad: The iPad is something that you're not used to, but a 2-yo can be up and playing with it in about 30 seconds. It's complex, but done simply. These aren't major issues - and luckily can be mucked with outside of a major redesign fairly easily. But, they make the car less user-friendly for lack of a better term.