Blog: Ford and the converging global consumer
Dave Leggett | 1 February 2010
The US light vehicle sales numbers for January should make for interesting reading when they are published later this week. Indications are that the overall market will be weak, with a seasonally adjusted annual running rate that has slipped back from December's level. It will be another sign that the economic recovery and recovery to car sales will likely be slow in the US this year and that car demand remains very, very low by historical standards.
It could well be another good sales month for Ford, with market share continuing to edge up. And Ford is on a high right now. It has just posted financial results that look pretty good. In the context of the severe crisis that has hit Detroit, they are even better than pretty good. They suggest that volume car manufacturing in America by long established American companies is not necessarily in terminal decline and that if companies can get the product right, the customer will - eventually – follow.
But the real test for Ford is probably still to come. The next Ford Focus is in many ways a physical embodiment of Alan Mulally's 'One Ford' strategy. This will be a truly global car on a global platform that comes with what Ford hopes will be class leading technologies culminating in a compelling product package that will work anywhere in the world. The biggest challenge for the car will probably be in the US where pricing on a smallish car - even a heavily loaded one - could put margins under considerable pressure. We'll see.
Are consumers around the world converging? Yes. But there are significant regional taste differences. Until now, Ford Focus in Europe has been a very different proposition to Ford Focus in North America. Ford is betting that the global convergence in consumer tastes will continue and that the platform allows sufficient tweaking for some regional differentiation.
It's about a global brand transformation with Ford brand values consistent across the world, along with a higher degree of consistency of product (though Ford won't, say, drop the F-150 pickup for North America; some things stay regional).
We'll know in a few years' time how successful Ford has been with the next Focus. Expectations are going to be high for a car that may turn out to be Ford's first true 'world car'.
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