At NY auto show, Ford focuses on change

CEO Alan Mulally, recently recruited from Boeing, says carmaker is overhauling both its management and its product line.Photos: New cars rev up
Written by Candace Lombardi, Contributor
NEW YORK--Alan Mulally is trying steer his company in a new direction.

"It's going to be hard for the next couple of years, as Ford tries to transform itself," the Ford Motor chief executive and president said during his keynote speech at this year's New York International Auto Show.

Alan Mulally Alan Mulally

Mulally, who joined the company last fall after 37 years at airplane manufacturer Boeing, said he set four priorities for Ford in response to the company's loss of market share and profit in recent years: massive restructuring of plants to manufacture smaller vehicles, acceleration of new products, and reorganization of management all the way down to car dealers and financing.

The CEO joked that six months ago, he told his finance team that he would be available day and night on his BlackBerry. They told him he had to go to the bankers himself to ask for the financing because "you're the only new thing we have," he said.

Mulally said Ford plans to refresh its entire product line by 2010 and 70 percent of the product line as soon as 2008. The biggest change: a shift in focus on sport utility vehicles and trucks toward smaller vehicles with better fuel efficiency.

NY auto show

The company has gone from selling 30 percent cars and 70 percent trucks to a split of about 46 percent to 54 percent, signaling that Ford is going where the market is, Mulally said.

"Clearly, the world has changed as oil prices have gone up and people want smaller cars," he said.

Mulally highlighted Ford's interest in hydrogen fuel technology, touting a recent White House visit to show President Bush hybrid electric-hydrogen fuel vehicles. He joked about a near miss in which Bush almost plugged an electrical cord into the wrong outlet on a car.

"We are working on a combo of things, just like the other car companies," Mulally said when asked which alternative fuel the company favors. "I'm glad we've stopped arguing over whether the temperature of the Earth has gone up or not, and now we can focus on what we are going to do to."

After the press conference, the automaker revealed its half-car, half-SUV Ford Flex, intended for fuel consumption-conscious families. In addition to a 3.5-liter V-6 engine and a 6-speed transmission that will deliver 260 horsepower, the car offers Ford Sync, the communications and entertainment system from Microsoft.

Ford also introduced several celebrity-inspired, limited-edition vehicles. The company plans to make only 1,000 Shelby GT500 KR (the KR stands for "King of the Road") coupes, set to be its most powerful Mustangs to date. Named after legendary race car driver and designer Carroll Shelby, the Shelby GT500 KR will include a 540 horsepower engine inside a custom carbon composite body.

Ford also announced that it will make 500 Ford F-150s in 2008 bearing the last name of car designer Chip Foose. In addition, a Funkmaster Flex edition of Ford's 2008 Ford Expedition, named for the music artist, will feature a red-and-black paint scheme with orange pinstripes, as well as Ford's 340-watt Audiophile sound system.

When asked about Japanese carmaker Toyota, Mulally had nothing but praise for his company's rival: "(Toyota) set the standard, making things people want," and it figured out how to do it efficiently.

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