U.S.-Bound Fiesta Creates New Business Model for Ford

Special Coverage

Greater L.A. Auto Show

DEARBORN, MI – Following months of hype and global sales success, the U.S.-spec Ford Fiesta B-car debuts today at the Los Angeles Auto Show.

However, the ’11 Fiesta is not just another product launch for Ford Motor Co.

“In the U.S., (the Fiesta is) going to start a whole new face for the company and a new business model for us,” says Jim Farley, group vice president-global marketing and Canada, Mexico and South America operations.

At a recent media event here, Farley outlines the different ways Ford has been marketing the Fiesta, which will debut early next year in the U.S. The car has been on sale in other parts of the world since 2008.

Farley says he drew upon his experience launching the Scion youth brand while working for Toyota Motor Corp.

Perhaps the most important lesson was “don’t put people in categories,” he says, noting although the Fiesta primarily is aimed at the so-called Millennial Generation, an age group born between 1995 and 2014, the car also is expected to appeal to Baby Boomers.

Farley has been using social media to reach potential Fiesta customers to learn what they want in a car. Perhaps the most significant of these initiatives has been the Fiesta Movement. Launched in May, the campaign put 100 European-spec Fiestas in the hands of carefully chosen participants, which Farley calls “agents,” most of whom are Millennials.

North American Ford Fiesta retains much of European styling.

In return for the 6-month use of the car, participants were asked to perform various missions, most of which were associated with traveling in the vehicle. Drivers than posted their insights online via Facebook, MySpace and the dedicated site Fiestamovement.com.

Farley says the feedback has proved invaluable, not only confirming what young consumers are looking for in a car today, but conducting this research in a way that cost far less than traditional marketing techniques.

“Already we have 60,000 hand-raisers for (the) Fiesta, and from within those hand-raisers 18 to 24-year-olds are the biggest group,” he says, noting the younger participants are consumers Ford was “not so familiar with.”

Due to the success of the Fiesta Movement, the car now has 60% brand awareness in its segment, Farley claims, noting the number is staggering. “To get 60% awareness with traditional media, it costs somewhere north of $50 million,” he says.

Ford also gained valuable insight into how B-car consumers purchase a vehicle, as they often tend to have less money than older car buyers.

The next step in the Fiesta marketing plan is to educate dealers about Millennial buyers, most of whom have yet to enter a Ford showroom.

“We’re connecting with our dealers to change and evolve their operations to sell to these customers,” Farley says. “That will include sales training and education, a lot more work on social media and how our dealers can market our products in their own dealerships through social media.”

Additionally, Ford is teaching dealers how to handle trade-ins brought in by Millennials. Farley says the auto maker may launch specialized financing programs for these younger buyers.

From the onset, the auto maker has said it would take special precautions to keep the Fiesta unchanged for the U.S. market, often not the case when a vehicle debuts overseas first.

Ford designers largely have succeeded. The U.S.-spec Fiesta will be available in both 4-door sedan and 5-door hatchback versions. The hatch retains the Fiesta’s signature grille opening, while the sedan assumes Ford’s North American 3-bar design.

In place of fog lights offered in other markets, Ford is using stylized light-emitting diodes to convey the car’s cutting-edge look. Fog lamps may be offered in the U.S. in the future, Ford says.

Keeping the car’s design intact while changing just enough to meet U.S. regulations has proved a difficult task, Kevin George, Fiesta design manager, says.

“I worked very hard for two-and-a-half years to make it look like I didn’t do anything at all,” he tells Ward’s. “That’s the goal, to preserve all the qualities, and I think we achieved that.”

George says his work was made somewhat easier because of the leeway he was given by upper management. Often, designers are forced to sacrifice styling for cost efficiencies, but that was not the case with Fiesta.

“Everybody was really focused on not de-contenting the car,” he says. “So the very few times when I said, ‘This is something I need,’ (management) always said, ‘Let’s find a way to preserve that; let’s help the studio get what they want.’ It was a different feeling on this program.”

One of the design elements George and his team have retained is the European Fiesta’s quad headlamps. “We would have made them dual headlamps, but they said ‘No, we have to preserve the quads,’ so they found a way to do that.”

While the Fiesta offers a variety of engines in other parts of the world, in the U.S. it will come equipped with just one – a 1.6L DOHC inline 4-cyl. producing an estimated 110 hp and 109 lb.-ft. (148 Nm) of torque.

Ford officials say they considered offering buyers a choice of larger and smaller engines, but research indicated the 1.6L was the perfect fit for U.S. small-car buyers.

Mated to either a 5-speed manual or twin-clutch, 6-speed automatic transmission, the Fiesta is expected to achieve a combined city/highway fuel-economy rating of 40 mpg (5.8 L/100 km).

The U.S. Fiesta includes a bevy of high-tech features, such as Ford’s Sync hands-free, multi-media system; keyless entry; and push-button start, a feature unique within the segment.

To keep the Fiesta marketing momentum going, Farley says Ford will launch a new online ordering program, rewarding consumers for signaling their intent to purchase the car early.

“We’re going to invite them to make a reservation, and there are three good reasons why they’ll do that,” he says. “We’ll give them Sync and a premium-sound system for free, and we’re also giving them priority-vehicle delivery.

“We’re not asking for any kind of down payment, just information from them,” Farley adds.

Ford is putting the finishing touches on renovations at its Cuautitlan, Mexico, assembly plant, where the North American Fiesta will be built.

The auto maker declines to reveal Fiesta volume projections and says pricing will be announced closer to the launch date.

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