How new Ford CEO Mulally will save the company
Ford is in trouble. Some new models are doing well, but all their gas guzzlers are in decline big time. So CEO Bill Ford has hired his own replacement - Alan Mulally, formerly of Boeing.
What can Mullaly do to turn the company around, and why was he chosen? Bruce Nussbaum at Business Week says that Ford needs innovation in their business model, to be more like Apple and Amazon. I think he's right, but I will let those with more knowledge talk about how to improve Ford's business model (if you have ideas, please comment below).
What I will talk about is product innovation. I think Ford Motor Company has picked exactly the right person to be CEO, and here's why: the Boeing 787 Dreamliner. The Dreamliner is not just a new jet. It makes extensive use of advance carbon-fiber composite materials to make it lighter, stronger, and more efficient.
Ford needs something really innovative, not just more cup holders or higher, skinner windows. They need to build a car using similar composite materials and blow past everyone in terms of safety and fuel efficiency.
Just taking a nice, stylish mid-size car like the Ford Fusion and replacing heavy metal parts with composites could cut weight drastically. Forget about hybrids—even though I think they're wicked cool—advanced materials are the ticket.
This is not a new idea – a few engineers are trying to do something similar with the Aptera at Accelerated Composites. Mulally has the expertise and the contacts to get the materials, get the designs together, and build up to production capacity. This could even be a boon to Ford's union workers. Even though large parts of the Dreamliner are built in Japan and Europe, a lot of the composite work is being done in the U.S., and there's a lot of work to be done on scaling production techniques before China can compete on labor costs alone.
It would be a huge, non-trivial problem, with a lot of pitfalls. I certainly don't know enough to even begin listing the challenges to such a plan. But it seems obvious to me why Ford would pick Mulally after looking at the Dreamliner. I just hope it's obvious to Ford as well.
Economic patriotism
won't meet with the bosses of General Motors Corp., Ford Motor Co. and the Chrysler Group. But he'll sit astride a Harley, visit a Nissan truck plant, herald the Toyota engine that won the Indy 500, campaign for Republicans and then have his press secretary swear there's no snub of Detroit.Sure, he drives a big 'ol pickup at his ranch in Texas and Cadillac builds his limos, but those press opps mean nothing when he won't say carburetor to Rick Wagoner, Tom LaSorda and Bill Ford. Should GM, Ford and the Chrysler part of DaimlerChrysler receive some sort of relief package along the lines of the bailout Chrysler got in 1979? Considering the current government's track record with the airline bailouts, probably not a good idea. But that does raise a good question: Why were we quick to hand checks and concessions over to the airlines ("You wanna legally probe passengers? Well, okay!"), but any specter of doing the same for the automotive industry immediately meets boos and hisses? And yes, the domestics got in over their heads with pensions and with concessions to the unions. They've got to figure a way out of that hole. When GM appoints one of its top honchos specifically to deal with the issue, you know 1) it big problem, and 2) they takin it seriously. And yes, it has become difficult to discern domestic from foreign lately, with Nissan building cars in Tennessee, BMW building in South Carolina and GM and Chrysler building in Canada. I grew up in Central Ohio, where Honda's Marysville plant drew workers from an hour and a half away and suppliers employed thousands. The real factors underneath this problem, though, lie in Americans' perception of its own automotive industry. We now give it the short-shrift, look on it with the same despicable frowns as we gave the imports 25 years ago, and blame poor sales on poor quality, irrelevant products and that hangnail you got on the test drive. But keep in mind that Toyota's currently going through a million-car recall, the Ford F-series pickups have outsold even the VW Beetle over each respective lifespan and initial quality studies mean crap outside of the dealer's lot. Am I here to tell you which cars to buy? No. Am I here to tell you something more than your immediate satisfaction hangs on the line? Yes. Now you tell me why you bought your car.