US:Ford shakes up sales operations
Ford shakes up sales operations
Firm announces reorganization of its North American marketing team as it tries to end market share slide
Bryce G. Hoffman / The Detroit News
Bloomberg News contributed to this report.
DEARBORN -- The sweeping job cuts and factory closures planned at Ford Motor Co. have little chance of returning the company to prosperity if it can't put the brakes on a 10-year U.S. market share slide.
Ford outlined a new strategy Monday to blitz the market with small cars, hybrids and crossovers, while tempering its reliance on truck-based SUVs and profit-eating incentives.
On Tuesday, Ford followed up with the announcement that its top North American sales and marketing executive, Steve Lyons, is leaving in March after less than a year in the position, part of a broader reshuffling of executives.
Lyons, 57, will be succeeded by Cisco Codina, 54, who is currently in charge of Ford's customer service division.
Codina, a veteran sales executive, is stepping into one the toughest jobs in Detroit.
He's charged with rallying dealers, cutting rebates and stabilizing Ford's market share -- all at the same time. And industry analysts are already churning out pessimistic forecasts that question whether Ford has enough new cars and trucks coming out the near future to stem the slide.
While the F-series pickups, the Mustang and the Ford Fusion midsize are strong sellers, promising new vehicles like the Ford Edge and Lincoln MKX crossovers won't reach showrooms until late this year. And Ford's bread-and-butter SUVs, such as the Explorer and Expedition, have suffered huge sales drops.
"We see sizable North American share loss continuing, weighing on earnings and offsetting many restructuring benefits," Goldman Sachs analyst Robert Barry said in a note to investors.
Analysts from several other consulting firms -- including CSM Worldwide, Global Insight Inc., Edmunds.com and IRN Inc. in Grand Rapids -- also have predicted Ford will lose share again this year.
The combined share of Ford's three domestic brands -- Ford, Lincoln and Mercury -- dropped 4.7 percent last year, from 18.3 percent in 2004 to 17.4 percent in 2005. A decade ago, Ford's U.S. market share stood at nearly 25.6 percent. Every percentage point of market share now represents 170,000 vehicles.
Dealers like new plan
The good news for Ford is that its powerful dealer network appears to be excited about the company's new direction.
"It's a terrific plan," said Jerry Reynolds, a large Ford dealer in Garland, Texas. "I love the change-or-die mentality. It has everything to do with my future. I live and die by the products they provide us."
Ford dealers across North America learned of the executive changes in a Web broadcast Tuesday, during which Lyons -- who plans to become a Ford dealer himself in Arizona -- said goodbye and formally handed the reins to Codina.
"The dealers love Cisco," Reynolds said. "But Steve had as good a sense of the market as anyone I've ever seen at Ford Motor Co. It was uncanny. Sometimes I thought he had a crystal ball."
Chris Lemley, who owns several dealerships in the Boston area, also liked what he heard.
"Obviously, it was a sad and difficult day for a lot of Ford employees," he said. "(But) Mark Fields" -- president of Ford's Americas division -- "and his team are on the right track."
Fields said Monday that Ford will introduce hybrid versions of the Ford Five Hundred, Mercury Montego and Ford Edge within the next four years.
That was good news to Pat Nealon, sales manager at Walnut Creek Ford in Walnut Creek, Calif. He said his customers want more hybrid options.
"That would be excellent," Nealon said. "The Blue Oval has been around for a long time. It's not going anywhere."
Ford also said Monday that it plans to introduce a generation of exciting small cars that are anything but econo-boxes, as well as a segment-defining class of "people movers" that combine the attributes of a crossover, station wagon and minivan.
Lemley said these vehicles should bring new customers to his dealerships and give existing customers more options. But he also can't afford to wait several years before seeing a fresh lineup of new vehicles.
"My question is how quickly they can deliver," he said.
Models to be discontinued
Ford also will lose some models this year.
The company's Lincoln LS sedan is being discontinued. The Taurus sedan, which still was Ford's top-selling passenger car in 2005 after a 21 percent decline in sales, will go out of production this year, United Auto Workers union officials in Atlanta said last year.
The Atlanta plant that makes the car is being closed as part of Monday's restructuring announcement.
One part of the "way forward" plan that Lemley and Reynolds are less certain about is Ford's commitment to eschew big incentives in favor of a more value-oriented pricing strategy.
"The incentives today are not just used to reduce the price of the vehicle. They are a way to get existing owners to buy new cars," Reynolds said. "If those go away, it absolutely stops our ability to trade."
"We've gone overboard with them," he said. "(But) I definitely don't think they can just be shut off. It needs to be a gradual thing."
Ford announced several other executive moves Tuesday.
Darryl Hazel, 57, will replace Codina as the head of that division, while Al Giombetti, 49, will become the vice president in charge of Ford and Lincoln Mercury marketing and sales.
"I couldn't dream of a better team to lead Ford's North America marketing, sales and service organization," Fields said in a statement. "Cisco, Darryl and Al have years of talent and experience and a winning attitude. They will help bring to reality our accelerated commitment to having customers drive everything that we do."
Ford also said Barbara Gasper, its vice president of investor relations, is leaving the company. Gasper played a lead role Monday during the presentation of Ford restructuring plan, which called for 30,000 blue-collar job cuts and 14 factory closures by 2012.
In another change, Tim O'Brien, 53, Ford's vice president of corporate relations, was named deputy chief of staff overseeing executive operations and sustainability.
The changes helped Ford move closer to its goal of reducing its number of corporate officer by 12 percent by the end of the first quarter of this year.
My first car was a 67 Mustang Coupe, 2nd one was a 67 Cougar XR-7, 3rd one was a 66 Mustang Coupe. Why did I get rid of these cars for ? I know why, because I'm stupid, stupid, stupid.
My next Ford.....