Ford to Better Leverage Global Resources

DETROIT – There are similarities between the massive North American restructuring Ford Motor Co. currently is undergoing and the recent reorganization of its European operation, a top executive says.

“I think Ford of North America is doing exactly what Europe’s done,” Lewis Booth, executive vice president-Ford of Europe and Premier Automotive Group tells Ward’s at the Detroit auto show here.

Lewis Booth

“Ford is resizing its business, which is very difficult and very painful,” he says. “It’s placing emphasis on the brands it’s responsible for, really working on getting new product to market and having great success improving quality. Those are the fundamentals of the business.”

Booth’s correlation bodes well for North American operations. While official figures have yet to be released, he says that Ford of Europe will posts its third consecutive year of profits for 2006.

An integral part of Ford’s Way Forward restructuring strategy is bringing new product to the North American market quicker. To achieve that goal, the auto maker has promised to better leverage its global resources, something Booth says Ford has failed to do in the past.

“We clearly haven’t leveraged our global resources,” Booth says. “We thought the benefits we could get locally exceeded the benefits we could get working together. In hindsight, we probably misjudged.”

Although Booth declines to provide details of how the two regions plan to work together, he does say the small B-car segment is something the two are examining.

“If Ford North America decides it wants a B-car because the segment is growing very quickly, they’ll be looking at Ford of Europe to use our global platform,” he says. “They may also use the Ford of Europe top hat, which has already been developed.”

Ford annually sells 500,000 B-cars in Europe and another 100,000 in the Asia/Pacific region, Mark Fields, president-The Americas, told Ward’s at the Detroit show this week.

Should a joint B-car program move forward, there would be regulatory issues involved in selling a car designed for Europe in the U.S., Booth admits.

However, such issues would be relatively easy to overcome, he says, pointing out archrival Toyota Motor Corp. sells the same models globally with little modification.

“Maybe we’ve been looking at the markets in a too fragmented way,” Booth says. “This is what North America needs; this is what Europe needs; this is what Asia/Pacific needs.

“But in truth, we’re competing with the same competitors. So if Toyota can have one car that works well in each region of the world, with some local tailoring, then we should be able to do the same.”

Booth says newly appointed global product chief Derrick Kuzak is the ideal candidate to leverage the auto maker’s worldwide resources, thanks to the five years he spent in various capacities at Ford of Europe.

“Derrick knows his way around here quite intimately,” Booth says of North America. “And Derrick knows the products in Europe intimately because he spent so much time in Europe.

“So when you’re talking about sharing products, he knows what they look like. He knows how they work. He knows what the benefits are.”

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