09-15-06: In a tense press conference this morning, Ford’s new CEO Alan Mulally made his first major public appearance in announcing the acceleration of sweeping changes at the troubled automaker. The announcement has been long awaited since Ford posted over a billion dollars in losses for the last quarter. Wall Street and stockholders wanted to know how Ford plans to stop the bleeding.

What Ford announced today is an acceleration of its current strategies to cut costs, reduce workforce, roll out new product and increase profitability. Plant closures previously announced will be moved forward and buyout packages will be expanded for much of its hourly workforce. With those closures will be the end of a few products such as the Ford Taurus and Freestar minivans. Other closings such as the Norfolk, VA plant will increase the workload at plants like the Rouge Center, where F-150 production will be consolidated.

On the product front, a number of key projects were presented to show that Ford has fresh metal in the pipeline. For the Mustang enthusiasts out there, some good news came. “We added additional Mustang derivatives to our near-term product plans – to ensure we have at least one new Mustang every year. One of those will be the return of the Bullitt, and it’s coming in 2008, " said Mark Fields, Ford President of the Americas.

Our exclusive rendering above suggests what the 2008 Bullitt might look like. No additional details or specifications have been announced at this time.

Other significant product news was that the Lincoln Town Car will continue production, despite previous news that it would be cancelled when the Wixom, MI plant closes next year. Livery customers and coach builders voiced their continued need for the car, so its production will be moved to the St. Thomas, Ontario plant to be built along side the Crown Victoria and Mercury Marquis.

Ford also announced that a production version of the Fairlane concept shown last year will be coming to market in 2008. The vehicle will be based on the same platform as the Ford Freestyle but will be slightly larger, offering more space inside to go with its bolder styling. Offering three rows of seating the new people mover will likely have a name other than Fairlane. A Lincoln version is also in the works.

Ford will be announcing a new SuperDuty F-Series in a couple weeks. The F-150 is being redesigned for a 2008 debut. News out is that a new family of engines will be offered in their best selling trucks including larger more powerful 5.8 and 6.2 liter “Boss” (formerly Hurricane) V8’s. A new small V8 diesel has been rumored for the F-150 and Expedition as well.

During the presentation, it was stressed that the turn around strategy has not necessarily changed from the plan announced earlier this year, but has been sped up. “The fundamentals of our Way Forward plan have not changed, but our timetable has changed dramatically,” said Fields. “We’ve taken a sobering look at the industry and our own business, and the entire team in North America has a renewed sense of urgency and a clear view of what it will take to position this business for profitability."

“We know our decisions bring more pain to the business in the short-term, and they require sacrifice from our employees, labor unions, dealers and suppliers,” he added. “But, together, we are building a much stronger Ford Motor Company and a more secure future for us all.”

The following are the bullet points for the accelerated turn around strategy:

North America “Way Forward” plan accelerated to deliver faster progress through 2008:

• Operating costs to be reduced by approximately $5 billion, including:
• Salaried-related work force reduced by a third, the equivalent of about 14,000 positions.
• Ford, UAW leadership agree on buyout offers for all U.S. Ford and ACH hourly employees.
• Further manufacturing capacity reductions planned.
• All ACH operations to be sold or closed by the end of 2008.
• More products to be delivered faster, including:
• 70 percent of Ford, Lincoln and Mercury products by volume will be new or significantly upgraded between now and the end of 2008.
• Ford’s truck leadership is fortified.
• Growth segments, including crossovers, are prioritized.
• All-new Ford full-size crossover to go on sale in 2008.

Product-Led Turnaround:

• 70 percent of Ford, Lincoln and Mercury products by volume will be new or significantly upgraded from today through the end of 2008. The new lineup builds on Ford’s strength as America’s truck leader while expanding in growth segments, such as crossovers.
• Ford will introduce an all-new full-size crossover based on the Ford Fairlane concept. The seven-passenger vehicle for modern families goes on sale in 2008 and will be produced at Ford’s Oakville ( Ontario, Canada) Assembly Plant.
• Ford will continue to lead the American truck market with a new Super Duty pickup confirmed to go on sale in early 2007 and an all-new F-150 pickup confirmed to go on sale in 2008. The vehicles boast powertrain, design and feature upgrades.
• Ford will continue to lead America’s sports car market with new Mustang derivatives each year.
• The new Lincoln MKS flagship sedan will go on sale in 2008 – packed with more technology and features than any prior Lincoln, including all-wheel drive. Current plans are to produce the vehicle at the company’s Chicago Assembly Plant.
• Lincoln will continue offering the Lincoln Town Car to meet ongoing demand. After assembly ends at Ford’s Wixom ( Mich.) Assembly Plant in 2007, Ford intends to move Town Car production to Ford’s St. Thomas ( Ontario, Canada) Assembly Plant. St. Thomas will be reduced to one shift of production, as previously was announced.
• Product development work is intensifying through 2008 on creating new small cars and even more crossovers that will go on sale in the future. These vehicles will be based on the company’s global vehicle architectures, including “B” and “C” platforms not presently used in North America.
• Major investments continue in new gasoline, flexible-fuel, diesel, hydrogen and hybrid powertrains, including additional E-85 ethanol-powered and hybrid vehicles on the road by the end of 2008. In addition, two out of every three Ford, Lincoln and Mercury vehicles will be offered with fuel-saving 6-speed transmission technology by the end of 2008.
• The new products and a voluntary consolidation of the Ford and Lincoln Mercury dealer network are designed to significantly improve the dealers’ through-put and profitability by the end of 2008.

Capacity Further Aligned with Consumer Demand:

• North America manufacturing capacity is being adjusted to 3.6 million units by the end of 2008, down 26 percent versus 2005 – in line with consumer demand and as announced earlier.
• Nine facilities will be idled and cease production through 2008, including seven already announced. The two additional plants are the Maumee ( Ohio) Stamping Plant and the Essex ( Ontario, Canada) Engine Plant.
• Ford’s Norfolk ( Va.) Assembly Plant will be idled a year earlier than planned, and a shift reduction, in advance of idling the facilities, now is planned at Norfolk and Twin Cities ( Minn.) Assembly.
• Facilities affected by the end of 2008 include the following:
• Atlanta Assembly – to be idled in October 2006
• Batavia Transmission – to be idled in 2008
• Essex Engine – to cease operations in 2007
• Maumee Stamping – intended to be idled in 2008
• Norfolk Assembly – to be idled in 2007, a year earlier than previously planned, with a shift reduction planned in January 2007
• St. Louis Assembly – already idled in March 2006
• Twin Cities Assembly – to be idled in 2008, with a shift reduction planned in 2007
• Windsor Casting – to be idled in 2007
• Wixom Assembly – to be idled in 2007
• Dearborn Truck Plant will add a third crew, beginning in 2007, for F-150 truck production.
• All ACH operations will be sold or closed by the end of 2008.
• Including Maumee Stamping and Essex Engine, Ford has announced plans to cease production at 16 North American manufacturing facilities by the end of 2012, including seven assembly plants.