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Tuesday, January 18, 2011

Ford Vertek Concept and the case of a global car




Ford's Vertek Concept unveiled to the public at the 2011 Detroit NAIS is a thinly disguised replacement for the next generation Ford Escape and Ford Kuga. In line with FoMoCo CEO Allan Mulally's One Ford strategy, both the Escape and Kuga will be harmonised as a single global model. Presently the Escape is an American-Asian-Australian model while the Kuga is only available in Europe. The Escape is a legacy from Ford's Ford-Mazda Alliance era, its sister car is the Mazda Tribute.

Contrary to the popular perception, Ford wasn't being stupid by making two different crossover type soft SUVs for different markets. Short of making a very long academic post on the merits and demerits of a global car, in short, it is extremely costly to build global car (again contrary to common perception), mainly due to highly fragmented vehicle regulations adopted by the world's main car markets. The UNECE Transport Division runs a World Forum for Harmonization of Vehicle Regulations tasked to gradually harmonize these differences but it is one very tall order. There are actually very few examples of a successful global car. Toyota's Corolla being most obvious example. VW's Golf may be considered as a global car but it is hardly a commercial success outside of Europe. Even the Civic, supposedly another global car, has at least 3 different models for different markets, as is the Camry, which has 2 different models.

There-in lies the main problem with a global car - trying to build a one-size fits all solution. Even taking the example of a Corolla, when examined closely beyond the obvious, there are actually very little similarities between an American market Corolla, European market Corolla and a Asian market Corolla. Japan imposes tax based a vehicle's dimensions while Americans like their cars big. How do you find the sweet spot without hurting sales in either market? Well you can't, that is why there are two different main Corolla model line; one for Japan and the other for overseas. Plus, the US adopts a different safety standard - with minimum height for headlamps, bumpers that resist 5mph shunts with no deformity, minimum size for rear view mirrors, airbags that work even with drivers not belted.

And then there are the emission standards, Europeans favour diesels coupled with manual transmissions while modern diesels, even in its current form is still illegal in many US states (due to diesel engine particulates and NOx emissions) and not all gas stations in the US carry diesel fuel. It's a similar thing in Japan. So on top of the structural and safety legislation engineering issues, powertrain development is now far more complicated, with engine and transmission electronics work to accommodate a far wider range of engine and transmission options. In the US, you would shove in a gasoline V6 or a V8 with a standard automatic transmission and that's it.

On top of structural and safety engineering comes chassis tuning to meet those horrible cobbled roads of old Europe, especially in France, Belgium, Germany and UK. The car has to be neutral enough to be safely driven by grandmas in the Scandinavian snow, but still provides sufficient feedback and proper handling to satisfy those ultra picky German drivers, while being soft enough for the lazy Americans cruising along at 55mph on the Interstate. And don't forget the cupholders must be large enough to fit American supersize cups.

Thus, some organizations find that it is more logical to have regional model than to try to produce a global car, hoping that it would eventually sell in numbers large enough to justify the business case. Ford's organization is a fragmented one - with considerable autonomy granted to their individual operations in North America, Australia and Europe. It was actually more cost effective for each of the individual main regional markets of Ford to run their own independent product developments by sharing parts / components already available in other regional Ford models, than to a global effort to meet the polarizing needs of the Europeans, Asians and Americans. In the pre-Mulally Ford, the organization is just not structured to push things along when it comes to product development on a global scale. Being fragmented is not always a bad thing. Organizations sometimes grow too big to be managed centrally, as Toyota found out with its recall-gate. Information just don't get sent to the right people on time. There are some instances when granting autonomy would be better. VW for example allows its Chinese and South American operations (VW's two largest outside of Europe) to pretty much do its own thing, away from much interference from Wolfsburg. However compared to Ford, VW still exercises more control over its regional offices compared to Ford's Detroit HQ to its Australian or European offices.

Allan Mulally's new vision is to model itself against Toyota's global operations. The new Fiesta, the next generation Ford Focus and most recently, the Vertek concept are the new models that will spearhead his "global cars" plan. However, under Mulally, Ford has now emerged as the strongest of the American domestic Big-3 car makers.

The Vertek will be Ford's first global SUV, set to replace Ford's existing monocoque body small-mid SUVs, the Escape currently sold in America, Australia and Asia and the European market only Kuga. Expected launch date will be end 2012. Body-on-frame SUV models like the Everest however will remain as an independent model within the T6 Ranger-Everest model programme.










Read more about the design story of the Vertek Concept here.

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