Slightly OT but this may be of interest to some:
Friday May 14, 1:00 am Eastern Time
Growing Ford Motor May Challenge GM
By BRIAN S. AKRE
AP Auto Writer
DETROIT (AP) -- Under aggressive new leadership, Ford Motor Co. is on a roll. There's
even talk in Detroit that the world's No. 2 automaker eventually could overtake No. 1
General Motors Corp. for the first time since 1930.
Becoming No. 1 was ''not something we spend a lot of time worrying about,'' William Clay Ford Jr. said after presiding over
his first annual meeting as chairman Thursday. But he and new president and chief executive Jac Nasser have done little to
discourage the speculation.
''I'm not sure size is a harbinger of success.'' Ford said. ''If you do everything else well, size and profitability follow.''
For the past two years, Ford has been more profitable than GM as the larger automaker has fought with its unions and
struggled to halt its long-shrinking market share. While Ford's annual sales still significantly trail GM's by about 1.4 million
vehicles, Ford has the greater momentum.
Since assuming control in January from the retired Alex Trotman, Ford and Nasser have frequently stated their goal to make
Ford Motor ''the world's leading consumer company that provides automotive goods and services.''
While GM continues to shrink its operations to refocus largely on assembling cars and trucks, Ford has been expanding with
the recent acquisition of Sweden's Volvo and some auto-related businesses.
In Europe, Ford recently bought the Kwik-Fit chain of automotive service shops. In the United States, Ford is launching an
ambitious expansion into auto recycling, hoping to bring economies of scale to a largely fragmented but highly profitable
business.
At a news conference after Thursday's meeting, Nasser hinted that more such moves were coming.
''We're clearly focusing on growth, both internally generated growth and other opportunities that fit into our consumer-oriented
strategy,'' he said.
Not everyone on Wall Street is convinced the strategy will work.
''There's a little bit of head-scratching going on with all the acquisitions in the service sector,'' said analyst Gary Lapidus of
Sanford C. Bernstein & Co. ''Not be cause people disagree with the strategy, but the jury is still out on how well they're going
to execute it.''
Analysts say Ford's biggest strength has been its ability to expand and improve its model lineup -- especially in light trucks --
while cutting costs. In recent years, Ford has killed off slow-selling car lines and dominated the market for pickups and sport
utility vehicles.
''They've realigned their capacity and model mix more aggressively to better serve the needs of the consumer -- more so than
General Motors,'' Lapidus said. ''I expect them to continue to gain market share over the next two years as they introduce a lot
of very exciting products.''
While Ford has significantly lagged GM in car sales, its newest models -- the Focus subcompact, the retro Thunderbird
roadster and Lincoln LS among them -- hold the promise of a turnaround.
''They could become an unbelievable powerhouse on the car side of the market,'' said Wes Brown of the automotive
consulting firm Nextrend. ''That in and of itself will lead to continued growth.''
At GM, ''there's still too much focus on the belief that all you need is good marketing and buyers will come,'' Brown said.
''That's not the case.''
GM acknowledges it has room for improvement but is not about to relinquish its No. 1 position.
''We're committed to staying No. 1 through the growth of our business and a commitment to improving our product line and
building what the customers want,'' spokesman Tony Cervone said. ''But we'll do so prudently.''
David Cole, an industry expert at the University of Michigan, said GM is gearing up to compete better against Ford's truck
lineup. Its redesigned full-size pickups have been hot sellers, and new SUVs built on the pickup's chassis will debut later this
year.
''It's going to be a horse race,'' Cole said. ''There's nothing to suggest victory is won or lost for either.'' |
