After a big year for the US auto market, Ford took a victory lap — but the carmaker isn't slowing down (F)
Matthew DeBord/Business Insider
Ford has been taking a lot of risks — and seeing major rewards.
In the past three years, the carmaker has launched a new Mustang; revamped the F-150 pickup truck to use more lightweight aluminum; done the same thing with larger Super Duty pickup, with the first redesign in 20 years; tangled with president-elect Donald Trump; and staged a comeback in competitive sports-car racing by winning the 24 Hours of Le Mans with its new Ford GT supercar, 50 years after an epic 1996 1-2-3 win.
In 2016, Ford once again enjoyed a healthy sales year, as the US auto market set a new record on the back of highly profitable vehicles that Ford is good at building: pickups and SUVs.
At the 2017 Detroit auto show, the company allowed itself a brief victory lap, celebrating the F-150's multi-decade run as America's best-selling vehicle, a crown it captured yet again in 2016. Ford's North American boss, Joe Hinrichs, lauded the F-Series "40 straight years as America's favorite truck" in a presentation that involved much of the Ford executive suite.
Ford also brought the battle-scarred Le Mans-winning Number 68 GT, still encrusted with grime from the Circuit de le Sarthe in France.
But the news that Ford overwhelmingly wanted to focus on at the most important auto show in the world wasn't the past — it was the future.
Speeding up Chariot
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Ford plans to make a $4.5 billion investment in new electric, hybrid, and autonomous vehicles over the next five years. As part of that commitment, the company plans to build a hybrid version of the F-150 as well as a hybrid Mustang. A fully self-driving car, with no steering wheel, brakes, or gas pedal, is slated for 2021, said Raj Nair, Ford's Chief Technology Officer.
"We're bringing tech to the masses," Nair said. "That's defined us as a company for a century."
The real Ford fireworks belonged to CEO Mark Fields and Chairman Bill Ford, who together have been charting a path for the 100-plus-year-old automaker to become as much a provider of mobility as a manufacturer of cars.
"We expect to see extremely healthy, 20% margins from this emerging part of our business," Fields said.
He added that Ford is now planning a faster expansion of Chariot, the San Francisco-based shuttle-bus service that the automaker acquired last year in an undisclosed all-cash deal.
Ford is holding a "City of Tomorrow" symposium in Detroit to coincide with the auto show, exploring these new lines of business and seeking insight for how they'll evolve in urban settings.
Mobility as a human right
Matthew DeBord/Business Insider
In a brief conversation among Fields, Bill Ford, and Aspen Institute CEO Walter Isaacson, the notion that mobility is a basic human right" was explored. Bill Ford believes that mobility becomes a human-rights issue as global gridlock contributes to poverty and pollution.
Fields also expressed his optimism about Ford's investments in the future.
"It's important for any business to have one foot in today and one foot in tomorrow," Fields said.
For his part, Bill Ford was happy to take a few more steps into the future. After expressing his expectation that self-driving vehicles will arrive sooner than anyone thought, he predicted that the next big thing could be "flying autonomous cars."
If the auto industry hadn't been on such a run for the past few years, it would be difficult to imagine this issues dominating the conversation at a major auto show, where carmakers typically focus on stoking consumer demand.
But it's evidence of how optimistic Ford feels about is recent risk-reward successes that the company is willing to keep the risks coming.