Ford unveils new roadmap for survival

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: For the last six weeks, Ford Motor Co’s top executives met almost daily to craft a plan to keep the company solvent in the face of the worst financial crisis in decades.

Surrounded by black-and-white photographs of Henry Ford and the Model T in the Thunderbird Room on the 11th floor of Ford’s headquarters, they waged a battle to decide Ford’s future.

CEO Alan Mulally and his leadership team worked through lunch, taking quick bites of Caesar salad as the global credit crisis deepened and automobile sales collapsed. With gasoline prices falling, some argued that Ford should abandon its costly plan to retool North American truck factories to produce smaller, more fuel-efficient cars from Europe. “Others pushed to curtail future investment in key products like the F-150 pickup that have seen sales drop off dramatically recently.

Global product development chief Derrick Kuzak— backed by Mulally—countered: If Ford has a future, it depends on delivering a new generation of class-leading cars and trucks that people actually want to buy. They fought off every challenge to one of the most ambitious product plans ever put together, albeit at the cost of thousands of jobs.

“We’re only going to be in business if we create products that people really do want and value,” Mulally told The Detroit News in an exclusive interview. “This is the essence of creating a viable Ford.” Unlike rival General Motors Corp, which has curtailed its investment in some new vehicles to conserve cash, Ford is betting the business on new cars in a make-or-break bid to turn the company around before time runs out.

Ford’s latest launches have done little to arrest its decade-long decline in the US market share, and it is far from certain that the cars and trucks in

Ford’s pipeline will be enough to turn the tide. Yet, Wall Street analysts such as Eric Selle of JPMorgan say this is the only way forward for an automaker that has wasted too many years producing lackluster products that barely covered its costs.

“The status quo is no longer acceptable,” he said. “Abandoning the product plan would have been a bad move.” Ford has demonstrated that it can make money off its small cars in Europe, Selle said, adding that the concessions it won from the United Auto Workers union last year should allow Ford to do the same thing in this country.

Crunching the numbers