Gov't Helps GM, Chrysler; Ford Helps You!

Auto news #3: while GM and Chrysler cling to government life support, Ford has enough fight left in it to help customers through the recession. Ford just announced that if you buy a new Ford between now and June 1 and then lose your job, the company will cover your car payment, up to $700 a month, for a year.

A commenter noted yesterday that I paint plenty broadly when it comes to portraying corporations as evil. Point well taken. Ford surely has its bottom-line reasons for offering what is essentially private unemployment insurance. They are following a plan similar to one that helped Hyundai avoid the huge sales losses that pretty much every other automaker has experienced so far this year. But I will grant that Ford is recognizing that social responsibility and fiscal responsibility go hand in hand. "You help us, we'll help you," Ford is saying. "We're all in this together."

Update 11:35 CDT: GM's in, too! New CEO Fritz Henderson says GM will cover up to nine $500 payments for laid-off customers.

Focus on the Focus: Ford Cutting SUVs

NY Times reports a big industry shift: Ford Motors, which led the 1990s gaz-guzzling charge with the F-series trucks and Explorer SUV, is shifting back to small cars. Expected changes:

• "Convert three North American assembly plants from trucks to cars"
• The Wayne, Michigan plant will switch from making Expeditions and Navigators to turning out more Foci.
  
• "Manufacture more fuel-efficient engines" at all factories
• Two V-8 engine plants switch to make more 4-cylinder and V-6 engines.
  
• produce six... European car models for the United States market"
• integrate the Mercury division in the small-car strategy [Bill Vlasic, "Ford to Make a Broader Bet on Small Cars," New York Times, 2008.07.22]
  

Swapping F-150s for Fiestas won't be an easy switch for Ford: big vehicles brought huge profits ($15K on full-sized SUVs). As Vlasic reports, in 2004, two-thirds of Ford's sales were trucks, vans, and SUVs. While car sales constituted 28% of other automakers U.S. sales in 2004, they made up just 28% of Ford's. Then Ford CEO Alan Mulally pointed out just how out of touch with the market Ford was: small cars make up 60% of the global market; large vehicles, just 15%. (I'm assuming the other 25% is "medium" vehicles... or maybe bikes!)

Here at home, we've already made the SUV shift. We use our 2001 Focus for almost every trip. I still love my Jeep, but it sits idle most of the time, coming out only when my wife and I are headed different directions, when Dad and I break out the trailer to haul mulch or lumber, or when the snow is flying and we've got to get to town. Even those trips we can minimize: We schedule our trips not to conflict. We get UBC to deliver lumber. And we plan ahead and get groceries before the blizzard comes. Those aren't absolute solutions, but they help to the point that we realize our next car can be even smaller.

Ford is officially announcing this mission shift Thursday, when it rolls out its surely gloomy second-quarter earnings report. Surely the intention is to give investors something (anything!) to cheer about.

And you know, a sensible production strategy that recognizes the realities of the economy and energy in the 21st century might be reason enough to buy some Ford stock, not to mention another Ford.

Update 08:55 CDT: Maybe Ford should add trains to its business plans: Amtrak reports a 28% increase in ridership and 33% increase in ticket revenue on its Downeaster line for fiscal year 2008