Dear Mr. William Clay Ford Jr.,
It’s almost half an year since I saw you last time on “China Expansion Strategy 2025” Event in Dec, 2017.
Rather a coincidence. From 2008 crisis in the USA to Ford’s restart in China in 2018, as well as the time gap between the two growth plans in China, each is a step of one decade. For Ford, the 115 years history is composed of one dozen decades, so this decade is a key period for ford, of course.
Once you denied that ford declined in the name of more attractive portfolio and show rooms in 2020. Besides those words for investors, we know that ford did meet trouble these years, from sales volume downfall in China to your retreat in North American sedan market and Japan, even dimming your glory such as top position on Navigant Research self-driving rankings.
So what happened to Ford? We want to ask you. But I think you also want to get the answer from us. Hereby, I offer three pairs of key words for your reference.
No.1 Cold and Warm
Four or five years ago, ford owned the crown of the fastest growing foreign car manufacturer in China, enjoying a warm growth rate between 19% and 49%. Since 2016, however, the sales volume fell year by year while all the monthly deliveries numbers declined yoy in 2018, at the rate of 11% to 30%. So you could feel the chill from the newest numbers.
Market needs your cultivation with enthusiasm and warmth. If you do so, then you could get warm fruits. Conversely, you will have to confront a chilly wasteland if you play it cool. As ford grasp profit from China with a cold-blooded style, in stead of pleading heart and soul, the growth turned into downfall in a much saturated market compared with several years ago.
Ford brought cold wind to China firstly, then was rewarded with hailstones. First, the cold wind is in portfolio since there were few new models of importance launched in China after “15·15 Plan” completed. Take MY 2016 Kuga for example, it’s almost the same as the old model. Second, Ford acted slowly within the new trend of small crossover, 7 seat crossover and compact sedan after the popularity of compact crossover. The only explanation for the torpid reaction might be Ford ‘s freeze in the chilliness. At last, Ford once coerced dealers to pile up stock in a cold-blooded way, aiming to get better sales volume result. You treated the distribution channel as cold as ice, so you would get a frozen sales volume.
Once an executive from Chang’an Auto complained to us, “For Ford, the USA is the most important market, while China can wait for a chance.” That sentence is colder than the winter wind. We did wish to see “15·15 Plan” bring Ford to a brand new spring, however, an “Ice Age” was following.
I agree that Ford is improving, for example, it will launch over 50 new models in China before 2025, and found better relationship with dealers.
But the plan is just the basic architecture and the first step, you must implement it perfectly. The new portfolio should be made up of volume cars, profit cow cars, and models for lifting brand image and so on. Details such as price strategy and launch date also count. If most of the 50 new models are products as Mondeo Energi which could not enjoy hight volume in China, Ford will be lacking new model, still.
Due to your desire for success in China, you must devote your warm hear, wholeheartedly, from every corner and every detail.
No.2 Fast and Slow
In fact, the chilliness from Ford is not only for China, but also for the whole internal-combustion engine vehicle business as the whole industry is entering a transitional period towards green and intellectual mobility. Every car manufacturer knows that tomorrow belongs to alternative energy cars and connected cars, but how can we get there?
Ford always wishes to be the fastest runner. So we saw Ford put huge investment into new start-ups at the price of ICE vehicle business shrinking, under the management of Mr. Mark Fields. From investing Velodyne/A rgo Al to purchasing SAIPS/Chariot, as well as shifting Dearborn building into silicon valley styled park, you must appreciated Fields’ harvest in the field of new mobility. So you supported him when he met the first shock of criticism. When you receive a degraded profit forecast of 9 billion dollars, nevertheless, Fields lost your umbrella.
A Déjà vu for 2001 when you dismissed Mr. Jacques Nasser? Then common problem under the management of Nasser and that of Fields, is running to fast, but not to slowly. The difference between the two depended on their goal, i.e., Nasser for E-commerce while Fields for new mobility. Both of the two were longing for the future, but sacrificed today. Fields should undertake the responsibility of radicalness, however, you should also afford the price.
China, is also another example for the much-too-high speed of Ford. As Ford wished to get a better sales volume, overstock became the poisonous water to quench the thirst. Before 2016, Ford neglected the need of dealers ecology. Chang’an Ford almost get 1 million sales in 2016, when Ford seld 1.27 million new cars in China that year. But as the car market is turning more and more saturated, you could hardly break the records above.
There is an old China saying "More haste, less speed“. The faster you run, the more drag you have to afford. And higher speed temporarily never equals a farther destination.
No.3 New and Old
Enterprises must evolve their corporate culture while the world is heading into a new period. New shell with old core never works. There are many car manufacturers keeping familial people -run character, such as Volkswagen AG, Daimler AG, BMW Group, Toyota Motor Corporation, and, Ford Motor Company.
I know that Ford had changed a lot in the aspect of corporate culture and management mode, from Taylorism or say scientific management theory appreciated by your great grandfather, to professional manager system founded by your father, and to your attention back to the core business. Dual-class share structure, however, strips the owner sense from many professional managers. That’s part of the reason why sometimes Ford executives are eager to get more beautiful sales volume instead of a better development method. Under that circumstance, executives might go to two extremes, one for laggard bureaucrats, the other for radical adventurers.
From the aspect of centralization and "mountain strongholds”, why were there lots of “axle crack” case happened from Focus to Fuga when Marin Burela took over Chang’an Ford? Why did they choose inferior steering knuckle supplied by CTCS? Why did Jason Luo quit his job as Ford China CEO after only several months? Ford Asia Pacific business was barrier for Ford China’s development, indeed. Do you know?
China is a special market, in the need of a specific department to control the business. Under Ford Asia Pacific, the localization can not be implemented thoroughly due to the global standard and procedure. For Ford China, it lacks power to control segments from R&D, manufacturing, QC, marketing to after sales and so on. GM China had come off GMIO since 2013, to improve the efficient by treat China as a special market, while Ford China always under control of Ford Asia Pacific.
I heard that many executives sent to Ford China from the USA never bore the ambition to improve the business but treat the position as a chance of gilding. So bureaucracy accumulated and the problems were rooted in the soil.
Ford, once guiding the whole world into the assembly line revolution, met bottleneck in the era of industry 4.0. Can Ford break the barrier and be great again? Now all the eyesight concentrates on you and Mr. Hackett. What will the history of Ford be like after many years? Now the pen writing down the history, is controlled in your hand.
June, 26th, 2018返回搜狐，查看更多