How is the progress of Ford 2000?
The basic reason behind Ford 2000 wasn't a reorganization of the company. The issue was: What is the best way to position ourselves to be the leading automotive company going into the 21st century?
That's what we have concentrated on over the last two to three years: re-engineering the business.
We have made extremely good progress in establishing a global mindset.
We've made considerable progress in terms of developing a business plan and a product plan on a global basis that is integrated and that eliminated duplication and overlap.
And we saved about $11 billion over the five-year planning period while we were doing this. During this period we were also improving our quality dramatically.
And the cost cutting?
We said we would bring our costs down by $1 billion this year compared to last year. This is the first time we will have ever reduced our absolute costs year over year.
When I announced this, there were quite a few people who said, 'Hmmm ... this is the guy who has never missed a budget in his life.' But in the first quarter we were down $800 million.
How much better can you do?
We clearly are going to do better than $800 million and better than $1 billion.
Isn't the trend toward down-market cars in Europe making it more difficult to break even there?
We earned about $105 million or so in the first quarter. It's a tough market ... There isn't room for everyone.
I also believe you can make money on smaller vehicles whether they are smaller cars or smaller trucks. Ka is a good example of that. It's a very low investment, fast, efficient program. We can do more of those.
Are your 5 percent cuts on purchased parts working?
Yes. It isn't just about cutting the price. That doesn't get you very far. It really is a joint effort both internally and with our suppliers to reduce the total cost of developing and manufacturing parts.
This is not going to be a one-shot exercise. This will be ongoing in terms of benefits.