- The Mustang, the Thunderbird, the Crown Victoria.
Since 1903, the Ford Motor Company
has been responsible for some of the most iconic cars ever.
But as the world changes and new trends emerge,
Ford has announced the company will
stop selling sedans in North America.
When I head the news, I was shocked.
I asked my coworkers what they thought.
But they were speechless, too!
So on this episode of Wheel House,
we're gonna find out why.
The American Automotive industry
has always adapted to the world around it.
Cars have helped shape pop culture, but if you look closer,
cars are a product of the time, and not vice versa.
Cultural and socio-economic events influence
car design more than one single person ever could.
It may be cliche, but the Model T changed
how the world viewed cars in the early 20th century.
Automobiles were seen as a luxury,
and therefore inaccessible to common people.
Rather than court aristocrats,
who already owned luxury motor carriages,
Henry Ford chose to pursue a demographic
that had been neglected, blue collar working people
who didn't know they needed cars.
Not only was the Model T redefining how cars were sold,
it was also revolutionizing how cars were made.
In 1913, Ford introduced the automated assembly line,
which brought production time down
from 12 hours, to two and a half.
The Model T was probably the most famous instance
in which a car company succeeded
by adapting a new business model.
(upbeat disco music)
Fast forward to 1973, American cars were gigantic,
inefficient, but looked cool as hell.
Small Japanese imports felt wimpy by comparison.
The Chrysler Imperial Le Baron
was the biggest of the bunch, clocking in at 19.6 feet.
The 439 cubic inch, 7 Liter V8 cranked out 208 horsepower,
and got a whopping 9.8 miles per gallon.
Pretty extravagant, but all the extravagance
of the early '70s was short-lived.
OPEC, short for the Organization
of the Petroleum Exporting Countries
is a group that includes Venezuala,
Iran, Iraq, and Saudi Arabia.
The organization was outraged that the U.S.
had supported Israel in the Yom Kippur war
and proclaimed an oil embargo against the U.S.
The price of gas nearly tripled
over the course of the next year.
Suddenly, those small, efficient Japanese imports
didn't look so bad, they had great MPG and were reliable.
That meant that drivers didn't have to wait
in long lines to fill up on gas.
And the Japanese weren't the only ones
giving car manufacturers a headache.
The federal government introduced
the CAFE regulations in 1975.
Cah-fay? Cah-f? C-A-F-E?
Cah-fay, is how I'm gonna say it.
The Federal government introduced
the CAFE regulations in 1975 to improve fuel efficiency
in U.S. produced vehicles and light trucks.
This throttled back performance,
a pretty important selling point
for American vehicles at the time.
Gone were the days of the muscle cars,
and thus began the era
of small, cheap, and efficient commuters.
The only American made vehicles
comparable to Japanese imports were cars
like the AMC Gremlin and Ford Pinto.
Notoriously crappy beaters.
Cadillac even came out with the Cimmaron,
an 88 horse power sports luxury abomination,
that delivered neither luxury
nor sport in terms of ride quality.
American car manufacturers were destroying
their reputation by trying to compete
with Japanese sedans, and they were losing.
However, consumers were finding that they could
still get the power and room they expected
from U.S. made vehicles by purchasing
one of the few vehicle types which were not
subject to CAFE regulations, trucks.
(slow instrumental music)
U.S. manufacturers like Ford and Cheverolet
focused on making their trucks better,
because the market demanded it
and they were less restricted by regulations.
As their car division became less and less relevant,
their trucks surged to the front of the pack.
Cut to present day,
the F150 is the best-selling vehicle in America
and Ford just hired a new CEO in Jim Hackett.
The previous CEO was laid off because of stagnant
stock prices, rising production costs
and so-called uninspired vision
when it came to the Ford product line.
Historically, Ford has always had
rigid leadership and business models.
And Hackett's free-thinking methods are all but rigid.
In addition to quoting theoretical physicists,
Hackett uses words like fitness,
Auto 2.0 and design thinking when explaining
the direction he has planned for Ford.
But when it comes times to actually describe
what all that means, Hackett falls a little short.
I guess you could say he doesn't hack it.
That was stupid, alright. (laughs)
The new CEO might sound more like the head
of a new-age start-up rather than a major car company,
but to be fair, he does have some progressive ideas
that could usher in a new era for Ford.
Whether that's good or bad is up to you.
Hackett's vision for Ford is to transform it
from a car company into a mobility company.
His emphasis is to make smart vehicles for a smart world
and focus on developing electric vehicles,
self-driving systems and ride-sharing systems.
The company recently acquired a majority stake
in an autonomous vehicle engineering firm, ArgoAI.
They've invested in Japanese tech company SoftBank
and rolled out a plan to invest
11 billion dollars in electric vehicle development,
soon to be built in Detroit.
I tried looking up what ArgoAi and SoftBank actually do,
but their websites are incredibly vague,
yeah they do autonomous vehicles and technology.
With all that expensive innovation happening,
something has to be sacrificed.
The sacrificial lambs are the Taurus,
the C-MAX and the Fiesta.
The Focus line was gonna continue
as a weird lifted variant thing called the Focus Active,
but Ford was planning on building them in China,
making them subject to the new tariffs.
Tariffs that put a 10% duty tax on top
of what it already takes to import goods from China.
So Ford said "Alright, nevermind."
And canceled the Focus Active altogether.
This means the Mustang is Ford's
only traditional car left in their line-up
for the foreseeable future.
Those Pep Boys really like them burnouts, huh?
Hackett and the Board of Directors at Ford
saw the competition with Japanese sedans
and cross-over SUVs as a losing battle,
Americans have been loyal to Japanese sedans
since the '70s, which is when they
started topping best car lists.
Plus, Ford sees 90% of sales coming
from trucks, SUVs and commercial vehicles,
so contextually, as much as we might not like it,
this move makes sense, it just really sucks
to imagine that there might be a day
without any Ford cars on the road at all.
(melodramatic instrumental music)
Thanks for watching Wheel House.
We look at the issues that affect
you in the car world every week,
so hit that yellow subscribe button right there.
We talked about tariffs on a previous episode,
check it out right there.
The Director of Marketing at Kia
said he learned a lot from it, so that's cool.
(laughs)