From the BLDP thread.
To: llwk7051@aol.com who wrote (4879)
From: Hawkeye Friday, January 21, 2000 8:40 PM ET
Reply # of 4880
From the Calstart website:
Ford Chairman Says Internet, New Vehicle
Propulsion Technologies, and Social
Responsibilities Key to Automotive Industry's
Future
Editor's Note: Ford Chairman William Clay Ford, Jr., recently gave a
speech at the Automotive News World Congress in Detroit, Mich.
giving his perspective on the state of the automotive industry, from
past to present to future. Here is the text of that speech.
"The automobile business is about to
experience the most profound and
revolutionary changes its seen since the
Model T first hit the streets."
We've just closed the books on the 20th century, which was the age
of the automobile. Our industry defined the century, with personal
mobility, mass production, and widespread prosperity. Now we're at
the dawn of a new century… and a new millennium. And there are
new inventions, and new technologies, that are transforming our
business, and changing the world.
It seems like an appropriate time to look back at where we've been,
and - more importantly - look ahead to where we're going. At the turn
of the last century, our industry was in its infancy. Personal mobility
was an illusive dream. In fact, prior to the Model T, most people never
traveled more than 25 miles from home in their lifetime. The few cars
that existed were for the affluent.
Alternative fuels ruled. The automobile fleet was 40 percent electric,
40 percent steam powered, and less than 15 percent gasoline
powered. These cars were expensive, hard to operate, and unreliable.
Roads - where they existed - were mostly dirt. My great-grandfather,
Henry Ford, was working for the electric company. In his spare time,
he drove around the streets of Detroit in his homemade car, scaring
the horses. He and all the other automotive pioneers - the Dodge
brothers, Leland, Durant, Sloan - didn't know it at the time, but they
were about to invent the modern world.
You all know the rest of this remarkable story. I'm sure you enjoyed,
as I did, the prominence that the auto industry had in the media
coverage of the millennium. It was nice to see our accomplishments
and influence over the last century acknowledged and applauded. I
was especially proud when Henry Ford was named Businessman of
the Century, and the Model T was named Car of the Century.
But, as you know, automobiles are a "What have you done for me
lately?" business. It's important that we honor the past, but we can't
dwell on it. After 100 years of inspiration, innovation, and perspiration,
it's nice to take a minute to step back and admire the work we've
done. But the real reason I brought up the past tonight was to give us
a perspective on the future. The great philosopher Yogi Berra once
said "A guy ought to be careful about making predictions, especially
about the future." But the one thing the experts agree on about the
future is that the rate of change is going to keep accelerating. Our
industry is about to undergo a radical transformation in the very near
future.
I agree with Yogi that we should be cautious about making
predictions. But there are major trends that have already started that
are going to have a huge impact on our future. We don't have to
predict them, they're already here.
The automobile business is about to experience the most profound
and revolutionary changes its seen since the Model T first hit the
streets. There are many reasons for these changes, but three in
particular stand out: the rise of the Internet as a tool of business and
commerce, the arrival of mass-production alternatives to the internal
combustion engine, and the growing demand for greater corporate
social responsibility.
All three of these trends will have a major impact on our business…
but in different ways, and at a different pace. Let's take a look at
them.
The effect of the Internet is going to be fast and far-reaching. The
OEM's are racing to find ways to leverage the Internet throughout the
entire automotive value chain - from suppliers to manufacturers to
dealers to consumers. When we find the right business models and
link it all seamlessly - which is going to happen faster than most
people can imagine - it's going to have an incredible impact on our
business.
The way I've been describing that impact is to say that the Internet is
going to be the moving assembly line of the 21st century. It's going to
improve productivity, lower costs, and delight customers that much.
But the auto industry is also going to have a big impact on
e-commerce.
We're going to increase it from a billion dollar industry to a trillion
dollar industry. And we're going to save ourselves billions of dollars in
the process. Because of our size and influence, we're going to
greatly influence the Information Age, and shape it even as it shapes
us.
As I told a group of Wall Street analysts last week, perhaps the
investors who have been "irrationally exuberant" about all the
dot-coms that have yet to make a profit should think about being
"rationally exuberant" about the auto industry. We're going to be fully
wired, and we already have what every dot-com wants: customers.
The race is on to be the first with the most. At the auto show press
previews last week I think there were as many new Internet deals
announced as new model cars and trucks. And, judging from some of
the concept cars, soon web access speed is going to be as
important a measure as zero-to-sixty speed. Those who are first to
integrate the Internet into their business model will have a major
competitive advantage.
If the Internet race is a sprint, delivering mass production alternatives
to the internal combustion engine has been more of a marathon - but
the finish line is starting to come into view.
The problem hasn't been inventing the technology. Fuel cells were
invented 40 years before the internal combustion engine. And as I
said earlier, at the turn of the last century, the vast majority of cars
were powered by electricity or steam. Ford built two-seater electric
commuter cars in England in the early '60s. We built our first hybrid
vehicle in 1979. But until now, alternative powertrains have offered
neither the affordability nor the performance necessary to enter the
mainstream. The internal combustion engine came to prominence in
the early 20th century, and continues to rule today. The new
generation of hybrid-electric and fuel cell vehicles will change that.
In the near term, hybrids will make the first substantial inroads into
the market. They could represent 20 percent of the market in ten
years. That's a major business opportunity. It's one of the reasons we
announced last week that Ford was dedicating a new brand - TH!NK -
to the development and marketing of alternative fuel powertrains and
vehicles.
There were many new hybrid and fuel cell vehicles introduced last
week at the auto show. I introduced Ford Prodigy, a hybrid-electric
family sedan concept vehicle. Prodigy has the passenger and cargo
space of today's Ford Taurus, but gets nearly 80 miles per gallon,
with the power, drivability, and range that customers require. We'll be
selling a refined version of this vehicle in 2003.
Longer term, I believe fuel cell vehicles will finally end the 100-year
reign of the internal combustion engine as the dominant source of
power for personal transportation. It's going to be a winning situation
all the way around - consumers will get an efficient power source,
communities will get zero emissions, and automakers will get
another major business opportunity - a growth opportunity.
That leads right me right to the final trend I'd like to talk about this
evening - the growing importance of corporate social responsibility.
If you followed me so far, and you understand the impact that the
Internet and alternative powertrains are going have on our business, I
want you to hang in there with me on this one. I know to a lot of
people, this is a "soft" issue, pretty far down their priority list. But I
believe it is the most important issue facing the automotive industry -
and industry in general - in the 21st century.
There are two quick and easy ways for someone to dismiss this
trend - and either way would be a big mistake. The first way to
dismiss it would be to say "we already do that at my company." The
second would be to say "it doesn't affect our bottom line, so we can
ignore it." Let me explain what I mean by corporate social
responsibility, and you'll see why both of these responses are wrong.
Those who think they are already being socially responsible are
probably thinking in traditional terms. The automobile industry has a
long history of providing financial support to worthy causes. We build
schools and hospitals, we support the arts, and medical research,
and community groups. That's fine, but for today's consumers, that's
just the beginning.
Increasingly, the social obligation of business is being defined in
much broader terms. It includes anything that impacts people and
the quality of their lives.
With the great ideological conflicts of the 20th century fading and
mostly resolved, a huge segment of the population now longs for a
better world - cleaner, fairer, safer, more equitable, and more secure.
Sooner or later they'll be willing to pay for this better world… and
shortly after that, they will demand it.
Our market research and our common sense tell us that those
consumer demands will include not just better products, but better
producers.
Consumers will insist on doing business with companies they can
trust, companies that do the right things ethically and
environmentally, as well as economically.
To fully meet the expectations of these consumers, companies are
going to have to address the concerns of society. They are going to
have to be not just good neighbors, but active participants in the
success of the community.
Consumers will be smart enough to realize that corporations - which
control huge amounts of financial and human capital - have the deep
pockets necessary to deliver this "better world" in the form of cleaner
and safer products, more enlightened policies, more engagement
with communities.
And they will buy from the corporations that "get it." These
corporations will have an instinctive feeling for what consumers have
always wanted, but never dreamed they could have. In our case that
means personal mobility with no social or environmental trade-offs.
This is our task as we begin the 21st century.
A better world is the ultimate "must-have" product feature. Whoever
can deliver it will make friends - or, more accurately, passionate
advocates.
They'll also make a lot of money. This is a trend that is not going
away. It's going to keep getting stronger. If you look at what
happened at the World Trade Organization meeting in Seattle - even
factoring out the crazies - it's clear that people are demanding higher
levels of responsibility and involvement from corporations.
The so-called "sustainability" movement - which aims to preserve
business and the planet - looks at three bottom lines: economic,
social, and environmental. Soon the measurements will be in place
that will make corporate social and environment results as
accessible and understandable to the public as financial results are
today.
This year Ford is pilot testing a Corporate Citizenship Report that
follows the guidelines established by the Global Reporting Initiative,
or GRI. GRI is an effort between companies, government agencies,
and advocacy groups to develop guidelines for reporting on corporate
environmental, social, and economic progress. General Motors was
on the team the developed these initial guidelines.
In the not-too-distant future, this type of candid assessment - and the
demand for results - will be commonplace. Corporate citizenship will
increasingly affect not only purchase decisions, but investment
decisions as well.
In the past two years, the amount of money in socially responsible
investments has grown more than 80 percent - about twice as fast as
all assets under professional management in the United States. And
the new sustainability global stock index, just introduced by Dow
Jones, shows top sustainability firms are significantly outperforming
their peers.
This is not a soft issue, or a passing fad. When people are
empowered with knowledge and choices, they will do what's best for
themselves, their families, and their communities. And in a fiercely
competitive global market, where information is shared instantly,
consumers will literally have all the knowledge and all the choices in
the world. Companies that don't do the right thing will find that they
are not sustainable.
Before I end my remarks, and take your questions, I'd like to take
one more opportunity to give our industry a well-deserved pat on the
back.
In the 20th century, the automobile industry gave the average person
the freedom of mobility, and undreamed of prosperity. We made
enormous amounts of money for our shareholders. We led the
Industrial Revolution that created modern life. Those are incredible
accomplishments - but why stop there? With the talent and
resources we have, I'm confident we can have an even greater impact
on the 21st century. We should set our sights high. Let's give people
better cars, and better trucks - and a better world.
Reprinted with permission from Ford Motor Company. |
