FORD- FoMoCo- of Henry Ford

THE HISTORY OF FORD

FORD MOTOR COMPANY "Ford" redirects here. The Ford Motor Company (often referred to as Ford; sometimes called FoMoCo), NYSE: F is a multinational corporation that manufactures automobiles. The automaker was founded by Henry Ford in Dearborn, Michigan, United States (where the company is currently headquartered), and incorporated on June 16, 1903. In its twentieth century heyday, Ford, along with General Motors and Chrysler, were known as Detroit's "Big Three" automakers, companies that dominated the American auto market. Toyota surpassed Ford in revenue starting in 2004. Ford remains one of the world's ten largest corporations by revenue. Ford introduced methods for large-scale manufacturing of cars, and large-scale management of an industrial workforce. Ford implemented the ideas of Eli Whitney, who developed one of the first assembly lines using interchangeable parts, which made it possible to put the cars together at a much lower cost and with greater reliability and repeatability. The use of a chain-driven track to move the vehicles to the workers was unique in the industry and quickly became the preferred method for volume production. As the individual work tasks became simple and repetitive this allowed the use of unskilled laborers who could be quickly trained for a single task (though it also removed most of the satisfaction that a worker performing multiple tasks may enjoy). EARLY HISTORY Ford was launched from a converted wagon factory, with $28,000 cash from twelve investors. During its early years, the company produced just a few cars a day at the Ford factory on Mack Avenue in Detroit. Groups of two or three men worked on each car from components made to order by other companies. In 1908, the Ford company released the Ford Model T. The first Model Ts were built at the Piquette Manufacturing Plant. The company was forced to move production to the much larger Highland Park Plant to keep up with the demand for the Model T, and by 1913 had developed all of the basic techniques of the assembly line and mass production. Ford introduced the world's first moving assembly line on December 1 that year, which reduced chassis assembly time from 12½ hours in October to 2 hours, 40 minutes. However these innovations were not popular, and in order to stop the staff deserting the monotonous jobs, on January 5, 1914, Ford took the radical step of doubling pay to $5 a day, and cut shifts from nine hours to an eight hour day — moves that were not popular with rival companies, although seeing the increase in Ford's productivity, most soon followed suit. By the end of 1913, Ford was producing 50% of all cars in the United States, and by 1918 half of all cars in the country were Model T's. Referring to the Model T, Henry Ford is reported to have said that "any customer can have a car painted any color that he wants so long as it is black." This was because black paint was quickest to dry; earlier models had been available in a variety of colors. But most were black. On January 1, 1919, Edsel Ford succeeded his father as president of the company, although Henry Ford still kept a hand in management. The Ford company lost market share during the 1920s due to the rise of consumer credit. The company's goal was to produce an inexpensive automobile that any worker could afford. To keep prices low, Ford (at the behest of its owner, Henry Ford) offered few features. General Motors and other competitors began offering automobiles in more colors, and with more features and luxuries. They also extended credit so consumers could buy these more expensive automobiles. Ford resisted following suit, insisting that such credit would hurt the consumer and the economy. Due to market constraints, however, the company finally gave in and followed its competitors' lead when on December 2, 1927, Ford unveiled the redesigned Ford Model A and retired the Model T. In 1925, Ford expanded its reach into the luxury auto market through its acquisition of the Lincoln Motor Company, and the Mercury division was established in the 1930s to serve the mid-price auto market. POST WORLD WAR II DEVELOPMENTS Henry Ford II, grandson of Henry Ford, served as President from 1945-1960, and as Chairman and CEO from 1960-1980. "Hank the Deuce" led Ford to became a publicly traded corporation in 1956. However, the Ford family maintains about 40% controlling interests in the company, through a series of Class B preferred stocks. In the 1950s, Ford introduced the iconic Thunderbird, and the Mustang in the 1960's. By 1967, Ford of Europe was established. Harold Poling served as Chairman and CEO from 1990-1993. Alex Trotman was Chairman and CEO from 1993-1998, and Jacques Nasser served at the helm from 1999-2001. Henry Ford's great-grandson, William Clay Ford Jr., is the company's current Chairman of the Board and CEO. GENERAL CORPORATE TIMELINE source: Ford Motor Company 2002 Annual Report 1896: Henry Ford builds his first vehicle – the Quadricycle – on a buggy frame with 4 bicycle wheels. 1901: Henry Ford wins high profile car race in Grosse Pointe, Mi. 1903: Ford Motor Company incorporated with 11 original investors. The original Model A “Fordmobile” is introduced. 1908: Model T is introduced. 15 million are produced through 1927. 1911: Ford opens first factory outside North America – in Manchester, England. 1913: The moving Assembly Line is introduced at Highland Park assembly plant, making Model T production 8 times faster. 1914: Ford introduces $5 workday minimum wage – double the existing rate. 1918: Construction of the Rouge assembly complex begins. 1919: Edsel Ford succeeds Henry as Company President. 1922: Ford purchases Lincoln Motor Company for US $8 million. 1925: Ford introduces Ford Tri-Motor airplane for airline services 1927: Ford introduces the second generation Model A, from the Rouge complex. 1932: Ford introduces the one-piece cast V8 block. 1936: Lincoln Zephyr is introduced. 1938: Mercury division is formed to fill the gap between economical Fords and luxury Lincolns. 1941: The Lincoln Continental is introduced. Ford begins building general purpose “jeep” for the military. First labor agreement with UAW-CIO covers North American employees. 1942: Production of civilian vehicles halted, diverting factory capacity to producing B-24 Liberator bombers, tanks, and other products for the war effort. 1943: Edsel Ford dies, Henry Ford resumes presidency for the duration of the war. 1945: Henry Ford II becomes president. 1946: The Whiz Kids – former US Army Air Force officers – hired to revitalize the Company. 1948: F-1 Truck introduced 1949: The ’49 Ford introduces all-new post-war era cars. The "Woody" station wagon is introduced. 1954: Thunderbird introduced as a personal luxury car with a V8. Ford begins crash testing. 1956: $10,000 Lincoln Continental Mark II introduced. Ford goes public with common stock shares. 1959: Ford Credit corporation formed to provide automotive financing. 1960: Ford Galaxy and Ford Falcon introduced. 1964: Ford Mustang and Ford GT40 introduced. 1967: Ford of Europe is established. 1970: Ford establishes Asia Pacific operations. 1976: Retractable seat belts introduced. 1979: Ford acquires 25% stake in Mazda. 1981: Ford Escort introduced in the US. 1985: Ford Taurus introduced with revolutionary “aero design” styling. 1987: Ford acquires Aston Martin Lagonda and Hertz Rent-a-Car. 1989: Ford acquires Jaguar. 1990: Mazda MX-5 Miata unveiled. 1991: Ford Explorer introduced, making the rural/recreational SUV into a popular family vehicle. 1993: Ford introduces standard equipment dual airbags. 1996: Ford certifies all plants in 26 countries to ISO 14001 environmental standards. 1999: Ford purchases Volvo (car division). Bill Ford becomes Chairman of the Board. 2000: Ford purchases Land Rover from the BMW. 2001: Retro-styled Ford Thunderbird is reintroduced. 2003: Ford Motor Company 100th Anniversary. NEW DIRECTIONS FOR THE TWENTY FIRST CENTURY In 2000, under the leadership of the current Ford chairman, William Clay (Bill) Ford, the Company stunned the industry (and pleased environmentalists) with an announcement of a planned 25 percent improvement in the average mileage of its light truck fleet — including its popular SUVs — to be completed by the 2005 calendar year. However in 2003, Ford announced that competitive market conditions, and technological and cost challenges, would prevent the company from achieving this goal. Ford did achieve significant progress toward improving fuel efficiency during 2005, with the successful introduction of the Hybrid-Electric Escape. The Escape's platform mate Mercury Mariner is also available with the hybrid-electric system in the 2006 model year—a full year ahead of schedule—due to high demand. The similar Mazda Tribute will also receive a hybrid-electric powertrain option, along with many other vehicles in the Ford vehicle line. Ford also continues to study Fuel Cell-powered electric powertrains, and is currently demonstrating hydrogen-fueled internal combustion engine technologies, as well as developing the next-generation hybrid-electric systems. 2005 bond downgrade In May 2005, several bond rating agencies downgraded the bonds of Ford Motor Company to below investment grade (so called "junk bonds"). These downgrades were a recognition of high health care costs for an aging workforce and of the dependence of the company on profits from the sales of sport utility vehicles. Due to higher fuel prices, there has been a decrease in the profits on these vehicles owing to "incentives" (in the form of rebates or low interest financing), which were needed due to declining sales. Foreign manufacturers, not having the truck manufacturing capabilities to form a platform base for similar vehicles, have instead introduced so called "crossover" SUV's — vehicles built on an automobile or minivan platform rather than a truck chassis. These vehicles have proven to be very popular in the market, and Ford has introduced such vehicles as the Escape (including a Hybrid-Electric version), along with the similar Mercury Mariner and Mazda Tribute, and the Freestyle and Volvo XC70 and Volvo XC90 crossover SUVs. In the fall of 2006, Ford is scheduled to introduce the 2007 Ford Edge, Lincoln MKX, and Mazda CX-7. These vehicles were revealed at the 2006 North American International Auto Show and other car shows. As far as the other non-truck models, many (with the notable exception of the 2005 Mustang) have been disadvantaged in the marketplace owing to a perception by buyers that foreign manufactures (especially Toyota, Honda, and Hyundai) deliver better value in terms of fuel economy, reliability, and build quality. These perceptions are reflected in the used car market by higher values for these foreign models. For owners who frequently trade in and for those who lease their vehicles, the resale values are reflected in substantial cost differences with domestic vehicles costing more in overall costs. However, Ford hopes to reverse this trend, with the introduction of the new 2006 Ford Fusion, Mercury Milan, and Lincoln Zephyr midsize cars, which are expected to compete well in this segment. "The Way Forward" Main article: The Way Forward Ford responded to the circumstances that lead to the bond downgrade by creating a plan to reduce the company's fixed capital costs while maintaining a special focus on cars and car-based crossover vehicles. Over time, it hopes to make more of its product line profitable instead of relying on a limited portion of the products for profit. Making good profits across the product line requires that the company reduce the costs of development and production, while introducing new products that connect with consumers. In the latter half of 2005, Chairman Bill Ford asked newly-appointed Ford Americas Division President Mark Fields to develop a plan to return the company to profitability. Fields previewed the Plan, dubbed "The Way Forward", at the December 7, 2005 board meeting of the company; and it was unveiled to the public on January 23, 2006. "The Way Forward" includes resizing the company to match current market realities, dropping some unprofitable and inefficient models, consolidating production lines, and shutting down seven vehicle assembly plants and seven parts factories. Among these are plants in St. Louis Assembly (near St. Louis), Atlanta Assembly (near Atlanta), Batavia Transmission (Batavia, Ohio), Windsor Casting (Windsor, Ontario, Canada), and Wixom Assembly (Wixom, Michigan). Up to 30,000 hourly and salaried jobs (28% of the total workforce) in North America over the next six years are expected to be eliminated , which is comparable to similar cutbacks previously announced at General Motors. These cutbacks are consistent with Ford's roughly 25% decline in U.S. automotive market share since the mid-late 1990s. Ford's realignment also included the sale of its wholly-owned subsidiary, Hertz Rent-a-Car to a private equity group for $15 billion in cash and debt acquisition. The sale was completed on December 22, 2005. A joint venture with Mahindra and Mahindra Limited of India ended with the sale of Ford's 15 percent stake in 2005. BRANDS AND MARQUES Today, Ford Motor Company manufactures automobiles under the Lincoln and Mercury brand names. In 1958, Ford introduced a new marque, the Edsel, but poor sales led to its discontinuation in 1960. Later, in 1985, the Merkur brand was introduced; it met a similar fate in 1989. Ford has major manufacturing operations in Canada, Mexico, the United Kingdom, Germany, Brazil, Argentina, Australia, China, and several other countries, including South Africa where, following divestment during apartheid, it once again has a wholly-owned subsidiary. Ford also has a cooperative agreement with Russian automaker GAZ. Since 1989, Ford has acquired British nameplates Aston Martin, Jaguar, Daimler (div. of Jaguar), and Land Rover, and Volvo Cars from Sweden, as well as a controlling share (33.4%) of Mazda of Japan, with which it operates an American joint venture plant in Flat Rock, Michigan called Auto Alliance. It has spun off its parts division under the name Visteon. Its prestige brands, with the exception of Lincoln, are managed through its Premier Automotive Group. Ford's non-manufacturing operations include organizations such as automotive finance operation Ford Motor Credit Company. Ford also sponsors numerous events and sports facilities around the nation, most noteably Ford Center in downtown Oklahoma City and Ford Field in downtown Detroit. It is also noteable that both facilities share design aesthetics in addition to their common name and similar downtown location! GLOBAL MARKETS Initially, Ford models sold outside the U.S. were essentially versions of those sold on the home market, but later on, models specific to Europe were developed and sold. Attempts to globalize the model line have often failed, with Europe's Ford Mondeo selling poorly in the United States, while U.S. models such as the Ford Taurus have fared poorly in Japan and Australia, even when produced in right hand drive. The small European model Ka, a hit in its home market, did not catch on in Japan, as it was not available as an automatic. The Mondeo was dropped by Ford Australia, because the segment of the market in which it competes had been in steady decline, with buyers preferring the larger local model, the Falcon. One recent exception is the Focus — The European model has sold strongly on both sides of the Atlantic. Europe At first, Ford in Germany and the United Kingdom built different models from one another until the late 1960s, with the Ford Escort and then the Ford Capri being common to both companies. Later on, the Ford Taunus and Ford Cortina became identical, produced in left hand drive and right hand drive respectively. Rationalisation of model ranges meant that production of many models in the UK switched to elsewhere in Europe, including Belgium and Spain as well as Germany. The Ford Sierra replaced the Taunus and Cortina in 1982, drawing criticism for its radical aerodynamic styling, which was soon given nicknames such as "Jellymould" and "The Salesman's Spaceship". Increasingly, Ford Motor Company has looked to Ford of Europe for its "world cars," such as the Mondeo, Focus, and Fiesta, although sales of European-sourced Fords in the U.S. have been disappointing. In Asia, models from Europe are not as competitively priced as Japanese-built rivals, nor are they perceived as reliable. The Focus has been one exception to this, which has become America's best selling compact car since its launch in 2000. In 2001, Ford ended car production in the UK. It was the first time in more than eighty years that Ford cars had not been made in Britain, although production of the Transit van continues at the company's Southampton facility, engines at Bridgend and Dagenham, and transmissions at Halewood. Development of European Ford is broadly split between Dunton in Essex (powertrain, Fiesta/Ka and commercial vehicles) and Cologne (body, chassis, electrical, Focus, Mondeo) in Germany. Ford also produced the Thames range of commercial vehicles although the use of this brand name was discontinued circa 1965. It owns the Jaguar, Land Rover, and Aston Martin car plants in Britain which are still operational. Ford's Halewood Assembly Plant was converted to Jaguar production. Elsewhere in continental Europe, Ford assembles the Mondeo range in Genk (Belgium), Fiesta in Valencia (Spain) and Cologne (Germany), Ka in Valencia and Focus in Valencia, Saarlouis (Germany) and St. Petersberg (Russia). Transit production is in Kocaeli (Turkey), Southampton (UK), and Transit Connect in Kocaeli. Ford also owns a joint venture production plant in Turkey. Ford-Otosan, established in the 1970s, manufactures the Transit Connect compact panel van as well as the "Jumbo" and long wheelbase versions of the full-size Transit. This new production facility was set up near Kocaeli in 2002, and its opening marked the end of Transit assembly in Genk. Another joint venture plant near Setubal in Portugal, set up in collaboration with Volkswagen, assembles the Galaxy people carrier as well as its sister ship, the VW Sharan. Asia Pacific In Australia and New Zealand, the popular Ford Falcon is considered the typical (if not particularly economical) family car, though it is considerably larger than the Mondeo sold in Europe. Between 1960 and 1972, the Falcon was based on a U.S. Ford of that name, but since then has been entirely designed and manufactured locally. Like its General Motors rival, the Holden Commodore, the 4.0 liter Falcon retains rear wheel drive. High performance variants of the Falcon running locally-built engines produce up to 390bhp. A ute (short for "utility," known in the US as pickup truck) version is also available with a similar range of drivetrains. In addition, Ford Australia sells highly-tuned Falcon sedans and utes through its performance car division, Ford Performance Vehicles. These cars produce over 400bhp and are built in small numbers to increase their value as collectors' cars. In both Australia and New Zealand, the Commodore and Falcon outsell all other cars. In Australia they comprise over 20% of the new car market. Ford's presence in Asia has traditionally been much smaller. However, with the acquisition of a stake in Japanese manufacturer Mazda in 1979, Ford began selling Mazda's Familia and Capella (also known as the 323 and 626) as the Ford Laser and Telstar. The Laser was one of the most successful models sold by Ford in Australia, and outsold the Mazda 323, despite being almost identical to it. The Laser was also built in Mexico and sold in the U.S. as the Mercury Tracer, while the 1989 American Ford Escort was based on the Laser/Mazda 323. The smaller Mazda 121 was also sold in the U.S. and Asia as the Ford Festiva. Through its relationship with Mazda, Ford also acquired a stake in South Korean manufacturer Kia, which later built the Ford Aspire for export to the United States, but later sold the company to Hyundai. Ironically, Hyundai also manufactured the Ford Cortina until the 1980s. Ford also has a joint venture with Lio Ho in Taiwan, which assembled Ford models locally since the 1970s. Ford came to India in 1998 with its Ford Escort model, which was later replaced by locally produced Ford Ikon in 2001. It has since added Fusion, Fiesta, Mondeo and Endeavour to its product line. South America In South America, Ford has had to face protectionist government measures in each country, with the result that it built different models in different countries, without particular regard to rationalisation or economy of scale inherent to producing and sharing similar vehicles between the nations. In many cases, new vehicles in a country were based on those of the other manufacturers it had entered into production agreements with, or whose factories it had acquired. For example, the Corcel and Del Rey in Brazil were originally based on Renault vehicles. In the 1980s, Ford merged its operations in Brazil and Argentina with those of Volkswagen to form a company called Autolatina, with which it shared models. Sales figures and profitability were disappointing, and Autolatina was dissolved in the 1990s. With the advent of Mercosur, the regional common market, Ford was finally able to rationalise its product line-ups in those countries. Consequently, the Ford Fiesta is only built in Brazil, and the Ford Focus only built in Argentina, with each plant exporting in large volumes to the neighbouring country. Models like the Ford Mondeo from Europe could now be imported completely built up. Ford in Brazil produces a pick-up truck version of the Fiesta, which is also produced in South Africa as the Ford Bantam in right hand drive versions. Africa and Middle East In Africa and the Middle East, Ford's market presence has traditionally been strongest in South Africa and neighbouring countries, with only trucks being sold elsewhere on the continent. Ford in South Africa began by importing kits from Canada to be assembled at its Port Elizabeth facility. Later Ford sourced its models from the UK and Australia, with local versions of the Ford Cortina including the XR6, with a 3.0 V6 engine, and a Cortina 'bakkie' or pick-up, which was exported to the UK. In the mid-1980s Ford merged with a rival company, owned by Anglo American, to form the South African Motor Corporation (Samcor). Following international condemnation of apartheid, Ford divested from South Africa in 1988, and sold its stake in Samcor, although it licensed the use of its brand name to the company. Samcor began to assemble Mazdas as well, which affected its product line-up, which saw the European Fords like the Escort and Sierra replaced by the Mazda-based Laser and Telstar. Ford bought a 45 per cent stake in Samcor following the demise of apartheid in 1994, and this later became, once again, a wholly owned subsidiary, the Ford Motor Company of Southern Africa. Ford now sells a local sedan version of the Fiesta (also built in India and Mexico), and the Focus and Mondeo Europe. The Falcon model from Australia was also sold in South Africa, but was dropped in 2003. Ford's market presence in the Middle East has traditionally been even smaller, partly due to previous Arab boycotts of companies dealing with Israel. Ford and Lincoln vehicles are currently marketed in ten countries in the region. Saudi Arabia, Kuwait, and the UAE are the biggest markets. Ford's distributor in Saudi Arabia announced in February 2003 that it had sold 100,000 Ford and Lincoln vehicles since commencing sales in November 1986. Half of the Ford/Lincoln vehicles sold in that country were Ford Crown Victorias. In 2004, Ford sold 30,000 units in the region, falling far short of General Motors' 88,852 units and Nissan Motors' 75,000 units. ALTERNATE FUEL VEHICLES Bill Ford was one of the first top industry executives to make regular use of an battery electric vehicle, a Ford Ranger EV, while the company contracted with the United States Postal Service to deliver electric postal vans based on the Ranger EV platform. Many Ford vehicles now sport an emblem — a green leaf springing from a curving road-like twig — symbolic of the new "green" commitment to preserve the environment and reduce resource consumption, while delivering safe, economical, and effective products to the motoring public. Vehicles with this emblem are generally alternative fuel or flexible-fuel vehicles. The alternative fuel vehicles, such as some versions of the Crown Victoria especially in fleet and taxi service, operate on compressed natural gas - or CNG. Some CNG vehicles have duel fuel tanks - one for gasoline, the other for CNG - the same engine can operate on either fuel via a selector switch. Flexible fuel vehicles are designed to operate automatically on a wide range of available fuel mixtures - from pure gasoline, to ethanol-gasoline blends such as E85 (85% ethanol, 15% gasoline). Part of the challenge of successful marketing alternative and flexible fuel vehicles, is the general lack of establishment of sufficient infrastructure (fueling stations), which would be essential for these vehicles to be attractive to a wide range of consumers. Ford was third to market with a hybrid car — the Ford Escape Hybrid, and the first to market with a Hybrid SUV / Crossover. The Hybrid Escape will also be the first hybrid vehicle to market with a Flexible Fuel capability to run on E85 ethanol-gasoline mixture . The company is on track to selling 250,000 hybrids a year by 2010. Ford hybrids: 2004– Ford Escape Hybrid 2006– Mercury Mariner 2008– Ford Fusion/Mercury Milan 2009– Ford Five Hundred/Mercury Montego 2009– Ford Edge/Lincoln MKX MOTORSPORTS Ford has been active in a number of forms of motor sports. NASCAR Ford is one of four manufacturers in the three NASCAR series: Nextel Cup, Busch Series, and Craftsman Truck Series. Major teams include Roush Racing and Robert Yates Racing. Ford's racing teams debut the Fusion race car, replacing the Taurus, at the 2006 Daytona 500. Champ Car World Series Ford-Cosworth is currently the sole supplier of engines to the Champ Car World Series. Trans-Am Ford has a storied history in the Trans-Am series from the 1970s through today having won many championships and races with its Ford Mustang. Drag racing John Force has piloted his Drag Ford Mustang to several NHRA funny-car titles in recent seasons. Indianapolis 500 Ford powered racing cars have won the Indianapolis 500 many times. Formula One Ford was heavily involved in Formula One for many years, and supplied engines to a large number of constructors from 1967 until 2004. These engines were designed and manufactured by Cosworth, the racing division of which was owned by Ford from 1998 to 2004. Ford entered Formula One as a constructor in 2000 under the Jaguar Racing name, after buying out the Stewart Grand Prix team it had become increasingly involved in. The team achieved little success, and after a turbulent five seasons, Ford pulled out of F1 after the 2004 season, selling both Jaguar Racing (which became Red Bull Racing) and Cosworth. Rally Ford has also been active many years in the World Rally Championship, and has used various versions of the Ford Focus WRC since 1999 to much success. Ford has a very long history in rally racing, having previously run the Ford RS200 and many versions of the Ford Escort to great success. Sports cars Ford sports cars have always been visible in the world of endurance racing. Most notably the GT40 won the prestigious 24 hours of LeMans many times in the 1960s and still stands today as one of the all-time greatest racing cars. Touring cars Ford has campaigned touring cars such as the Focus, Falcon, and Contour/Mondeo and the Sierra Cosworth in many different series throughout the years. Notably the Mondeo finished 1,2,3 in the BTCC in 2000.

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