Ford 2009 Annual Report Download - page 19

Management’s Discussion and Analysis of Financial Condition and Results of Operations
Ford Motor Company | 2009 Annual Report 17
Ford Credit. During 2009, Ford Credit eliminated about 1,200 U.S. staff and agency positions within its servicing, sales,
and central operations. During 2010, Ford Credit plans to reduce its staffing by about 1,000 positions to improve its cost
structure, in response to lower financing volumes resulting from lower automotive industry sales volumes and the transition
of Jaguar, Land Rover, Mazda, and Volvo financing to other finance providers.
Accelerate Development of New Products Our Customers Want and Value
We are committed to introducing new products that consumers want and value, and we are receiving very positive
reactions from consumers, media, and independent evaluators in response to the products we introduced in 2009. We
plan to build on this strength in 2010. Our global product strategy is to serve all meaningful geographic markets with a
complete family of products that have best-in-class design, quality, green, safety and smart features. The result of this
strategy is to produce vehicles that:
• have bold, emotive exterior designs,
• are great to drive,
• are great to sit in (with the comfort and convenience of a second home on wheels and exceptional quietness),
• provide best-in-class fuel economy as a reason to buy,
• are unmistakably a Ford or Lincoln in look, sound and feel, and
• provide an exceptional value.
With GPDS and our global product strategy, we have a global product cycle plan, global product programs, global
product "DNA" and a global product development organization. This allows us to simplify, commonize and, hence, reduce
the number of vehicle platforms or architectures and parts, as well as to simplify vehicle ordering from the customer's
perspective. For example, we have reduced the number of global nameplates from 97 in 2006 to 59 in 2008, with further
reductions planned. In 2007, we had 27 different vehicle platforms, with 29% of our total production volume produced from
core platforms. In 2012, we plan to have 15 different platforms, with 72% of our total production volume produced from
core platforms. With our One Ford GPDS, we are working to make all small- and medium-sized Ford vehicles competing
in global segments common in North America, South America, Europe and Asia Pacific Africa by 2013. This will include
Fiesta- and Focus-sized small cars, Fusion- and Mondeo-sized mid-size cars and utilities, compact pick-ups, and
commercial vans. For example, in 2012, we expect to produce more than 2 million vehicles from our global C-car (Focus-
sized) platform and more than 1 million vehicles from our global B-car (Fiesta-sized) platform. The efficiencies resulting
from our One Ford GPDS and global product strategies are demonstrated by a 60% reduction in engineering costs and a
40% reduction in capital costs from 2005 to 2008, per typical new vehicle, with ongoing improvements planned.
In addition to these efficiencies, our global product strategies allow us to increase revenue by making our vehicles and
their features more attractive to customers. With bold, emotive design, high levels of quality, fuel economy leadership, top
safety ratings, innovative technology, greater feature content than competitive models and higher attractive series, we are
able to reduce brand discount and increase revenue. In 2009, average per-unit revenue from our vehicles sold in North
America increased by $3,300, from $22,800 in 2008 to $26,100 in 2009.
With the cost efficiencies and revenue increases that have been and will in the future be realized from our One Ford
GPDS and global product strategy, we believe we can achieve small-car profitability in the North American market as well
as other markets, and improve the profitability of all our vehicle lines in all markets.
Following is a discussion of new or future products offered or to be offered by Ford business units and a discussion of
each of the four pillars of our global product strategy:
Ford North America. Ford, Lincoln and Mercury brands collectively increased U.S. overall and retail market share 14 of
the last 15 months as of December 2009, and posted the first full-year market share gain since 1995. Our new
2010 Fusion Hybrid was named Motor Trend magazine's Car of the Year and awarded the title of North American Car of
the Year at the North American International Auto Show in January 2010. The Ford Fusion, the most fuel-efficient mid-size
sedan sold in America, posted a full-year sales record in 2009 with 180,671 units sold. The new Ford Transit Connect was
introduced in the second quarter of 2009 and was awarded the 2010 North American Truck of the Year at the North
American International Auto Show. The 2011 Ford Fiesta was revealed in North America in the fourth quarter of 2009 as a
new offering and will go on sale in the second quarter of 2010. The 2011 Ford Mustang debuted with a new family of V-6
and V-8 engines that deliver best-in-class performance and fuel economy and will arrive in dealerships in spring 2010.
Further product introductions are planned, as we plan to substantially increase the amount of new vehicle introductions by
volume versus 2009, an aggressive product introduction period. For 2010, these introductions include the all-new Ford
Fiesta, Focus, Explorer, Super Duty, Edge, Transit Connect Electric, Lincoln MKX and an all-new small car for Mercury.