Ford chief points to possibility of more price-cutting
" We'll do whatever we have to do to beat the thing back to life," hammers Louis E. Laitif, head of the Ford division of the Ford Motor Company since last January, who was in Boston to address the National Association of Broadcasters.Skip to next paragraph
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"We just can't close our eyes to price sensitivity and go on our way," he asserts.
Pointing to the pricing come-ons already posted by the company in a drive to move its '82-Model cars, Mr. Lataif agreed that consumers aran't confident about a lot of things, including the purchase of a new automobile.
In fact, he laments, "the stock market is weak, interest rates are high, and the debate goes on over whether the Reagan program will work.
"So people are unwilling to make a big commitment for a new car."
If Ford Motor Company and the other domestic car manufacturers cannot sell their '82-model cars at a faster pace than the introductory days indicate, the US auto industry will be in even deeper trouble than it is now. Cutting the price is one way to get-the attention of the buyer. At some point, the carmakers reason, the public will grab the bait and buy.
Ford is trying to battle back to a more viable position in the marketplace after a red-ink bath of monstrous proportions.
In 1980 the company lost more than $2.1 billion on its North American automotive operations and high losses have continued this year. Helping to soften the blow was a 1980 profit of $323 million from Ford of Europe; yet that, too, was off from $1.2 billion the year before.
Part of the Ford dilemma was its slow shift to meet market demand. General Motors, for example, is generally figured as at least two years ahead of Ford in reshaping and downsizing its cars.
Even so, Ford is battling ahead--cautiously, the Ford management asserts.
Ford, for example, is far behind its big rival, General Motors, in retailing a diesel-engine car. But that makes good sense to Ford, according to Lataif, who says the company could not have stood up to the heat that has swept around GM over its problematic diesels.
Some West Coast used-car books are even putting a negative value on some of the GM diesels because of their reputation.
Ford, however, will be joining the car-diesel fray within the next couple of years.
Several passenger-car and truck diesel-engines are on the way from Ford's Japanese affiliate, Toyo Kogyo (Mazda), as well as BMW-Steyr of West Germany. Ford, also has a contract with International Harvester for diesel-engine development.
Toyo Kogyo will provide small diesels for the Ford Escort/Mercury Lynx as well as the Ranger, Ford's new minitruck due out next spring as a 1982 model. In 1984, the BMW Steyr diesel will go into Ford's luxury cars and after that, in some other larger cars as well.
Ford of Europe also is developing its own small diesels.
"All of the new diesels are honest-to-goodness diesels that are being designed from a clean sheet of paper, not adapted from gasoline-fueled engines," Lataif says.