Staying Connected

Jac Nasser is sweating.

This is the afternoon shift at Ford Motor Co.'s Wayne Assembly Plant. And amid the noise, heat and the curious eyes of dozens of workers, Mr. Nasser is trying hard not to fall behind as he struggles to install wiring harnesses on Escorts.

This is one of the more difficult jobs at the plant, as Mr. Nasser himself has discovered.

With some 30 different wiring harnesses to choose from and a car rolling by about every 55 seconds, workers quickly must determine what country the car is destined for and the options it contains, then scramble to match and install the correct harness.

Dressed in blue jeans rather than his usual three-button Savile Row suit, Mr. Nasser clearly is out of his element, or so it would seem.

Get beyond the jeans and safety glasses and Mr. Nasser's visit to the plant - one of many he has made at various Ford facilities - actually is what makes him tick: hands-on in a big way.

And it's not just limited to the manufacturing process. Mr. Nasser, who turns 52 this month, personally has met new Ford owners; gone cruising with California high school students and telephoned customers at home to talk about their new Ford vehicle.

For Mr. Nasser, it's all part of making sure Ford leadership stays connected to all parts of the business.

"If that means working on an assembly line; working in a powertrain plant; meeting with present customers, future customers, dealers, suppliers, that's the business," he says. "It's hands on, it's hearts on, it's getting your mind around the business."

It's that drive, that hyper-competitiveness, that is fueling Mr. Nasser's push to transform Ford into a more nimble, consumer-focused automaker able to anticipate what customers around the world want and need.

In his first year as CEO he has rolled back parts of the Ford 2000 globalization campaign initiated by former Chairman Alex Trotman, opting for a new plan centered on regional- and brand-focused business units. This means, for instance, that Ford of Europe and Ford of South America now will operate as semiautonomous units, better able to respond to market demands than the sometimes-clueless executives formerly calling the shots from Dearborn. Design and production efficiencies, however, will continue to bubble up from Dearborn.

Mr. Nasser also has been burning up his corporate credit card. He spent $6.45 billion to purchase Volvo Cars; bought up Kwik-Fit, Europe's largest car repair business, and purchased a vehicle recycling center in Florida.

He also recruited a team of some of the best automotive executives; created a new luxury group to help the company sell more high-priced cars; struck a deal with Microsoft's MSN Carpoint service; formed an alliance with Priceline.com Inc. to test-market a name-your-own-price online buying option for new Fords in Florida and inaugurated a new car plant in Norway - the country's first - to build a thermoplastic, 2-passenger electric car called "Th!nk."

Individually, the ventures may appear disconnected. But connect the dots and it's easy to see where Mr. Nasser is taking Ford. If he can finance, insure, service and ultimately recycle every customer's vehicle, the potential profit margins could be huge.

"We are the biggest consumer product industry in the world," Mr. Nasser says. "We just haven't acted like a consumer company. No one in the industry has. We tend to spend all of our time from the design process to the delivery process and not really looking at what consumers look at. You know they have to finance their vehicles, they have to insure their vehicles. They're concerned about service and parts and they want a relationship, and they don't want a transaction or an entity company.

"The biggest impact you can have is the insight it gives us to consumers, because we're closer to them and we're more connected with them over a longer life cycle. You then take that insight and feed it right back into the creation process."

All of that sounds good, but before Ford can become a leading consumer company it first has to become a leading automotive company, and there are a host of other issues Mr. Nasser will need to resolve in the next millennium if the world's No. 2 automaker is going to live up to his lofty expectations.

At the factory level, Ford is facing sexual harassment lawsuits at a plant in Chicago and racial trouble at a facility in the U.K. There also is the issue of Visteon Automotive Systems and how to handle that spin-off. Mr. Nasser got through his first contract talks with the United Auto Workers union by agreeing to a deal that allows Visteon hourlies to remain Ford employees for life. What problems will arise, however, after a Visteon spin-off still is unknown.

On the product side, there is the complication of trying to sort out how Volvo will fit into the Ford framework; getting Lincoln turned around and determining Mercury's future. Mr. Nasser needs to move quickly or Ford risks looking like another General Motors Corp. with too much product overlap.

He also needs to find a way to sprinkle the company's truck magic onto its car lineup, particularly at the lower-segment end of the business where Ford has been unable to turn a profit.

There also are the critics on Wall Street who say Ford primarily remains a North American automaker with too much of its profits coming from U.S. light-truck sales. To solve that, Mr. Nasser has to figure a way to turn profits in Europe and South America before a downturn in the U.S. market strikes.

Certainly, improving upon the company's 1999 record performance will be challenging. But if the U.S. economy can keep humming, Ford's new mix of products should help it get through 2000, even if overseas operations continue to struggle.

"It's unlikely that we'll see another record year next year," he says. "But I wouldn't be surprised if we had next-to-a-record year in 2000."

The Lincoln LS is off to a fast start. Ford has more than 90,000 orders for its new Focus, which just went on sale in September. And the Taurus, with its major facelift for 2000, could close the sales gap with Camry and Accord.

Indeed, trucks still will play a big role. The Excursion effectively is sold out for 1999 and the Explorer Sport Trac, F-150 SuperCrew and redesigned Explorer Sport arrive in first-quarter 2000. The all-new Escape SUV breaks cover in the second quarter of 2000.

The outlook for South America and Europe isn't as positive. Efforts to re-establish Ford's presence in Brazil and Argentina remain stuck in first gear. In September, the automaker announced a $1 billion restructuring of its Brazilian unit in hopes of stemming mounting losses.

Ford Brazil says its plans for a $1 billion assembly plant for a new small car in Bahia is still a go. While the plant will have annual capacity for 250,000 units, Ford says the facility will build 100,000 cars by 2004.

In Europe, work resumes to turn a profit and cut excess capacity. Both tasks are on Mr. Nasser's short list, meaning there could be additional plant closings in the future.

"Ford brand in Europe has been disappointing for us over the last couple of years," Mr. Nasser says. "I think Europe will be a little weaker next year."

Ford hopes to see some turnaround with Focus, a refreshened Fiesta and, early next year, an all-new Transit van, perhaps Ford's strongest brand in Europe. That will be followed later in 2000 with a Mondeo replacement, codenamed CD132, that may not carry the Mondeo name.

But even with all of this new product, Mr. Nasser is not transfixed on trying to build Ford brand market share at the expense of the company's other marques.

"I think it would be relatively easy for us to re-introduce a vehicle that's larger than the Mondeo - and I think we'd pick up some share," he says. "But is that the right thing to do when you've got Mazda and Volvo and Jaguar? It's not the right brand positioning relative to the other brands. We' re not mesmerized by a little bit of share movement between the brands."

Instead, Mr. Nasser quickly has assembled a team made up of former executives from RJR Nabisco, DaimlerChrysler Corp., Audi and BMW AG that he believes can bring a fresh perspective to future products and help him resolve some of the major issues still facing Ford.

Has this change distracted Ford management? Mr. Nasser says it hasn't. If anything, it has re-energized the company, he says.

His bold move to relocate Lincoln Mercury headquarters to California could now be followed by the executive offices of Jaguar, Volvo and Aston Martin, particularly now that Victor Doolan, former head of BMW's U.S. operations who joined Ford in July as executive director of the Premier Automotive Group's (PAG) North American marketing and distribution strategy, is now in California.

"I know (the PAG) team is looking at how they can get synergies around design facilities, not design capabilities, and make sure that there's good communication across the different brands," Mr. Nasser says. "I'm sure there are studies going on."

Mr. Nasser isn't slowing down, which means executives at Ford better be prepared for another demanding year.

"Change is happening everywhere, and it isn't just the magnitude of changes, it's the velocity of change," Mr. Nasser says. "The alternative is to sit back and begrudge it or embrace it and become energized by the change and get people involved in it and be able to move quickly. That's what the successful companies in the 21st century are going to be about."

As for those working in Ford plants, they might want to have the chief executive come down and try their job for a few hours. The person handling wiring harnesses for today's Focus now has just five wiring harnesses to choose from, instead of the 30 on the previous Escort. They can thank Mr. Nasser for that.

Jacques Nasser shows no signs of slowing down. In his first year as chief executive at Ford Motor Co., Mr. Nasser has rolled back parts of the Ford 2000 globalization campaign initiated by former Chairman Alex Trotman, scooped up Volvo Cars for $6.45 billion, bought up Kwik-Fit, Europe's largest car repair business, and purchased a vehicle recycling center in Tampa, FL. That's just for starters.

His goal is to transform Ford into a more nimble, consumer-focused automaker able to anticipate what customers around the world want and need.

WAW Editor Drew Winter caught up with Mr. Nasser at the Specialty Equipment Market Assn. (SEMA) show in Las Vegas, prior to Mr. Nasser's trip to Norway to inaugurate a new car plant.

Among the highlights:

* Car and truck sales will be down from 1999 but "next to a record year."

* Ford is studying whether to relocate U.S. headquarters for Jaguar, Volvo and Aston Martin with Lincoln and Mercury in California.

* In Japan, Ford is revising its product strategy to include Lincoln and Jaguar.