Ford Hopes Sales of Taurus Repay Development Costs

To former Ford chairman Donald Petersen, the 1986 Taurus was the ''you-bet-your-company car.'' Struggling to reverse its declining market share and watching profits dry up, the normally stodgy Ford unveiled the first ''jellybean'' car. The Taurus quickly revolutionized automotive styling. More important at least for Ford, it brought in countless new customers. Now Ford is taking another risk, completely restyling the '96 Taurus at a cost estimated at about $2.8 billion. Initial reviews of the car itself have been strongly positive. But Ford's investment in Taurus is considerably higher than that of its competition, product chief Jacques Nasser admits, saying, ''We do need to bring down development costs.'' In a hotly competitive market, Ford may find it hard to recover all its investment, especially if industry sales remain weak for the rest of the year, and force a new round of rebates. Critics also point to the declining productivity of the two Taurus plants, based in Atlanta and Chicago. For years, they were the most efficient assembly lines in America. They've slipped back a few notches, according to the latest report from manufacturing guru James Harbour of Detroit's Harbour and Associates. Ford acknowledges the new models will take several more man-hours to build than the old one. Perhaps the biggest challenge faces Ford's marketing department. In recent years, the automaker has buoyed Taurus sales with hefty incentives, subsidized leases, and a dependence on daily rental-fleet sales. Ford plans to sell as many '96 Tauruses as possible - at list price - to retail customers. The question is whether it has the right stuff, not only to remain the nation's No. 1 seller, but also to keep delivering the type of profits Ford needs to pay off its investment.

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