11/1/2007 | 3 MINUTE READ

Insider: Don’t Celebrate Yet

Executive changes at Two of the Big Three are one thing. But there are a lot of other things that need to happen, too.
Facebook Share Icon LinkedIn Share Icon Twitter Share Icon Share by EMail icon Print Icon

Is Detroit finally getting its self-confidence back?


Facebook Share Icon LinkedIn Share Icon Twitter Share Icon Share by EMail icon Print Icon

Is Detroit finally getting its self-confidence back? After years of being beaten down by the press and consumers, Detroit now seems like it’s ready to go on the offensive when it comes to branding and marketing (with the hires ex-Toyota execs Jim Press and Deborah Meyer by Chrysler and Jim Farley by Ford), and even manufacturing, thanks to the more-competitive contracts signed with the UAW (by Two of the Three as of this writing). But let’s recognize that there is still a long way to go before the Big Three are truly “back,” and one fundamental goes beyond branding and marketing: Product...

While GM has certainly taken a lead in this area, Chrysler and Ford execs are going to have to move mountains to make sure that they’re offering the products people want at a price they can afford. At Ford, this may be particularly difficult. One just has to look at the “all-new” Ford Focus as an example of what is wrong with the U.S. auto industry. Rather than trying to develop a jaw-dropping, no-compromises small car to slide into one of the fastest-growing segments in the market, Ford decided it needed to save money and ordered the hood closure lines, door cuts and other portions of the vehicle remain identical to the vehicle it replaces.

Equally perplexing, Ford dropped the hatchback version of the Focus at a time when Honda’s Fit and Nissan’s Versa hatchbacks are selling like wildfire, not to mention the fact that Saturn will soon introduce a compact hatchback Astra in the coming months. The wagon has also been sent to the scrap heap. Both of these were replaced with a coupe version of the car, which like the rest of the new Focus lineup, looks like it was penned by the same team that did the Pontiac Aztek.

Meanwhile, over on the other side of the pond, Ford of Europe introduced the latest version of its Focus, which is much more modern and bold than the vehicle it replaces even though it was already an acclaimed product that racked up impressive sales. Alas, the critically important U.S. market is again delivered leftovers while other parts of the world get the cream of the crop, all in the name of cost.

At Chrysler there is also an equally daunting task in rationalizing the company’s product offerings as they relate to customer demand. The company may have been better off building one world-class midsize car as opposed to having to stretch the chassis and corresponding design budgets to accommodate two cars that are, well, adequate. And we all know that adequate doesn’t cut it when Detroit is still trying to gain a place on the consideration list of most shoppers. Rationalization of Chrysler’s brand product offerings will be needed in the short-term future, with a focus on building “wow” products that leave the customer wanting more and that’s going to require Chrysler return to its scrappy roots as the underdog, something that Cerberus may be able to instill in the company as it brings world-class talent on board to design, engineer and manufacture no-excuse vehicles.

Yes, there’s more than just product. Consumers must know what these companies are—or think they are. What does Ford stand for? Got me. The company has a rare opportunity to play off of its founder, Henry Ford, as the symbol of American ingenuity in a way none of the other automakers can. Henry should become Ford’s icon for the future in the same way other companies have used their founders to excite and maintain the stability of the organization.

Chrysler, meanwhile, is trying yet another tag line to define its flagship brand: “engineered beautifully.” Now if they will only stick with this for the next few years, maybe people will get it. The problem is that most automakers have a tendency to switch marketing messages faster than Lindsay Lohan switches rehab centers. Those who succeed form a link with their customers that withstand the two-year lease they have on their vehicles.

Detroit’s automakers have a lot of work to do. It is clear that there is a critical mass of people within these organizations that understand it. But there is still the bureaucracy—what one insider recently described to me as “the frozen middle”—that needs to get out of the way, whether it wants to, or not.